VERSITV   Of   CIVLirORNU    ^AN  [(irco 


3   1822  01388  6247 


jiiiiiiii ,, 

1822  01388  6247 


University  of  California,  san  diegc 

U  JOLLA,  CALIFORNIA 


OVERSIZE 


presented  to  the 
UNIVERSITY  LIBRARY 
UNIVERSITY  OF  CALIFORNIA 
SAN  DIEGO 

by 

Mr.    PTP-n-rge   Marshall 


RUSSIA 

Her  Economic  Past  and  Future 


By 

DR.  JOSEPH  M.  GOLDSTEIN 

Professor  of  Political  Economy  at  the  Moscow   Institute 
of  Commerce  and  Industry  and  of  the  University  of  Moscow 


Published  by 

THE  RUSSIAN  INFORMATION  BUREAU  IN  THE  U.  S. 

WOOLWORTH  BUILDING 
NEW  YORK  CITY 


Copyright,   1919 

Rnssian  Information  Bnrean 

New  York 


Introduction 


The  author  of  this  book,  Dr.  Joseph 
M.  Goldstein,  Professor  of  Political 
Economy  at  the  Moscow  Institute  of 
Commerce  and  Industry  and  of  the  Uni- 
versity of  Moscow,  came  to  this  country, 
delegated  by  the  University  of  Moscow, 
to  study  the  problems  of  trade  relations 
between  the  United  States  and  Russia 
and  the  possibilities  for  American-Rus- 
sian financial  and  commercial  coopera- 
tion. 

Prof.  Goldstein  is  considered,  in  Rus- 
sia and  throughout  Europe,  one  of  the 
foremost  authorities  on  problems  of  for- 
eign trade,  connnercial  treaties,  trusts 
and  syndicates.  The  prospect  of  peace 
has  to  a  certain  degree  revived  interest 
in  Russia  and  in  the  Russian  market 
among  American  business-men.  How- 
ever, this  interest  is  still  insufficient  con- 
sidering the  importance  of  the  possible 
American-Russian  trade  and  financial 
cooperation,  which,  if  properly  devel- 
oped, may  prove  of  great  benefit  to  both 
countries.  Prof.  Goldstein's  book,  pre- 
senting the  economic  past  of  Russia, 
and  the  great  possibilities  in  her  eco- 
nomic future,  appears,  therefore,  very 
timely. 

Bolshevism,  with  its  wild  experiments 
in  Russia's  political,  cultural  and  eco- 
nomic life,  with  all  the  misfortune  and 
destruction  it  has  brought  Russia,  nat- 
urally scares  and  disappoints  many  who 
were  previously  sincerely  interested  in 
Russia.  This  disappointment  should  not 
becloud  the  proper  perspective  neces- 
sary for  an  understanding  of  the  Rus- 
sian problem  as  it  stands  to-day.  The 
rule  of  the  Bolsheviki  cannot  but  be  tem- 


porary. This  faction,  with  its  naive  po- 
litical and  economic  experiments,  will 
disappear  as  soon  as  the  instinct  for  self- 
preservation  reasserts  itself  throughout 
Russia,  as  soon  as  Russia  recovers  from 
her  grave  wounds.  Young,  full  of  latent 
power,  she  is  passing  through  a  period 
of  utmost  disorganization  known  to 
every  country  that  has  passed  from 
tyranny  to  free,  democratic  develop- 
ment. With  the  disappearance  of  the 
Bolsheviki,  transportation  will  lie  rees- 
tablished, the  banks  will  be  reopened, 
the  financial  system  will  recuperate,  the 
management  of  industries  will  be  placed 
in  the  skilled  hands  of  the  industrial 
class. 

Russia's  present  economic  situation  is 
analogous  with  the  situation  of  the 
United  States  after  the  Civil  War,  and 
the  future  economic  development  of 
Russia  will  be  similar  to  the  economic 
development  of  this  country.  Four  ele- 
ments combined  made  possible  the  de- 
velopment of  the  United  States.  The 
first  element  was  its  youth,  energetic  and 
eager  for  work.  The  second  was  the 
natural  resources  of  the  country.  The 
third,  the  principles  of  democracy,  which 
recognize  for  everybody  a  definite 
amount  of  right  and  give  everybody  his 
chance.  The  fourth  was  the  foreign 
capital  which  flowed  into  the  United 
States  after  the  Civil  War,  and  made  it 
])ossible  for  the  American  people  to 
develop  the  natural  resources  of  the 
country. 

Two  of  these  elements  we,  Rus- 
sians, have  always  possessed.  We 
may  say  that  we  have  always  pos- 
sessed a  talented  people,  a  people  with 


great  latent  power,  a  people  which, 
under  the  strain  of  the  most  unfortunate 
national  history,  produced  a  wonderful 
culture.  On  the  other  hand,  we  possess 
almost  endless  and  priceless  natural  re- 
sources. Two  years  ago  the  third  ele- 
ment was  born — Democracy,  with  its 
creative  spirit.  There  is  always  trouble 
in  the  beginning  of  the  life  of  every 
Democracy,  but  in  the  long  run  it  is  a 
blessing  for  a  country.  It  has  been  a 
blessing  for  the  United  States.  It  will 
prove  a  blessing  for  Russia. 

As  soon  as  Russia  finds  herself — and 
she  will  find  herself  before  long — she 
will  need  foreign  capital  for  her  develop- 
ment just  as  the  United  States  needed 
it  half  a  century  ago.  Russia's  eyes  turn 
to  the  United  States.  The  United  States 
is  so  developed  industrially  because  the 
natural  resources  of  the  country  for  the 
last  fifty  years  have  been  united  with  the 
creative  power  of  foreign  capital.  As 
soon  as  normal  conditions  are  reestab- 
lished it  will  be  Russia's  turn.  During 
the  War  the  United  States,  from  a 
nation-debtor,  has  become  a  nation- 
creditor.  It  will  be  of  benefit  to  both 
countries  if  American  capital  will  take 
the  same  part  in  Russia's  industrial  de- 
velopment that  foreign  capital  once  took 
in  the  development  of  this  country. 

At  this  moment  practically  all  busi- 


ness relations  between  the  United  States 
and  Russia  are  at  a  standstill.  This 
should  not  discourage  American  busi- 
ness interests.  The  American  financial 
interests  must  prepare  for  financing 
Russia's  industries,  the  American  trade 
interests  must  prepare  for  future  trade 
with  Russia.  The  time  will  come— and 
it  may  come  very  suddenly — when 
everyone  who  is  prepared  will  be  richly 
rewarded. 

As  soon  as  Europe  comes  to  peace  and 
normal  conditions  are  reestablished  in 
Russia,  a  feverish  upbuilding  movement 
will  start  all  over  Europe,  and  Rus- 
sia will  lead  this  movement.  She  will 
build  railroads,  highways,  develop  her 
natural  resources,  build  up  industries 
and  trade,  which  will  bring  her  to  the 
foremost  ranks  of  the  civilized  nations. 
The  United  States  is  designated  by  his- 
tory to  participate  in  this  upbuilding  of 
the  young  democratic  nation.  Every 
business-man  in  this  country  should  be 
prepared  for  his  future  activities  in  Rus- 
sia, so  that  the  two  sister  democracies 
may  be  fully  benefited  by  this  possible 
and,  under  the  circumstances,  necessary 
cooperation. 

A.  J.  SACK 

Director  of  the  Russian  Irxformalion 
Bureau  in  the  U.  S. 

Tunc  1.  1919. 


Foreword 


I  dedicate  this  work  to  the  great  nation 
which  has,  during  the  past  35  to  40  years, 
succeeded  not  only  in  surpassing  the  indi- 
vidual national  wealth  of  England,  France 
and  Germany,  countries  with  thousand- 
year-old  civilizations,  but  has  created 
wealth  almost  equalling  their  combined 
total.  I  believe  that  the  great  American 
democracy  -whose  labor  was  so  vastly  as- 
sisted in  its  productivity  by  investments  of 
capital  from  old  Europe,  will  now  raise  the 
banner  of  economic  progress  in  the  Near 
and  Far  East,  and  will  find  in  the  limitless 
natural  resources  of  Russia  a  new  and  wide 
field  for  its  fabulous  energy,  initiative  and 
ability  in  subordinating  nature  to  the 
genius  of  men. 

Russia  is  at  present  passing  through  very 
violent  internal  changes,  and  should  I  suc- 
ceed in  awakening  interest  in  my  country 
among  the  readers  of  this  book,  I  will  feel 
fully  repaid  for  my  labors. 

DR.  JOSEPH  M.  GOLDSTEIN 


CHAPTER  I. 


Russia's  Economic  Development 
and  the  Old  Regime 


WHEN  the  War  started,  Russia 
was  just  at  the  beginning  of  a 
period  of  important  develop- 
ment. The  following-  are  the  basic  facts: 
Russia,  covering  almost  one-sixth  of 
the  total  land  area  of  the  globe,  had,  ex- 
clusive of  present  Poland  and  Finland, 
with  over  160,000,000  population*,  a  rail- 
road mileage  not  much  in  excess  of  that 
of  Canada  with  a  population  of  about 
8,000,000. 

Another  fact  that  illustrates  Russia's 
immature  economic  development  is  the 
small  number  of  joint  stock  companies 
engaged  in  her  industries.  The  total 
capital  represented  in  Russia's  industrial 
and  commercial  joint  stock  companiesf 
before  the  Revolution  was  about  2  bil- 
lion dollars,  approximately  one-ninth  of 
the  capital  invested  in  common  and  pre- 
ferred stock,  bonds,  etc.,  of  the  railroads 
of  the  United  States. 

A  still  more  striking  example  is  the 
fact  that  the  total  stock  and  bond  capital 
of  all  Russian  industrial  and  commercial 
corporationsf,  at  the  beginning  of  the 
War,  just  exceeded  the  stock  and 
bond  capital  of  one  American  concern, — 
the  United  States  Steel  Corporation. 

How  insignificant  was  the  capital  in- 
vested in  Russia  in  joint  stock  compa- 
nies maybe  seen  from  the  fact  that, when 
the  War  started,  the  paid-up  capital  of 
all  Russian  industrial  and  commercial 
corporations,   with   Russia's   population 


*  For  statistics  of  population  see  p.  99. 
t  Exclusive  of  railroads  and  banks. 


of  180,000,000,  was  less  than  2  billion 
dollars,  whereas  the  paid-up  capital 
of  such  enterprises  in  England,  a 
country  with  a  population  of  45,000,000, 
amounted  to  12  billion  dollars,  exclusive 
of  the  enormous  capital  invested  in  Eng- 
lish railway  companies.  The  number  of 
joint  stock  companies  in  Russia  barely 
reached  2,000,  while  England  had  more 
than  56,000. 

One  of  the  principal  causes  of  such 
stagnation  was  the  restriction  caused  by 
the  innumerable  regulations  which  the 
old  bureaucratic  regime  placed  on  the 
free  investment  of  capital  in  joint  stock 
companies. 

Another  important  factor  was  that 
until  very  recently  the  political  relations 
between  Russia  and  England  were  far 
from  friendly.  England's  capital  was 
always  the  most  energetic  and  forward- 
looking  in  the  development  of  the  pro- 
ductive resources  in  almost  every  part 
of  the  world,  having  contributed  materi- 
ally towards  the  construction  of  the  rail- 
way systems  and  of  a  large  number  of 
industrial  and  commercial  enterprises  in 
the  United  States,  Canada,  Australia, 
Argentine,  Asia,  Africa,  etc.,  etc.  But 
the  relations  between  England  and  Rus- 
sia having  made  it  imperative  for  Eng- 
land constantly  to  consider  the  safety  of 
India,  England  naturally  did  not  supply 
Russia  with  capital,  as  the  growth  of 
Russia's  productive  forces  would  have 
enhanced  her  political  power  and  pres- 
tige. 


RUSSIA— HER  ECONOMIC  PAST  AND  FUTURE 


Appoxi  mate       Value      of      Russias      Ac^riculfural      Proc/ucfion 

(In      Millions      of     Roubles) 

1910 


895 


Approximate      Value     of      Russiois     lnc?lusfrial       Producl-ion 
(In     Millions      of    Roubles) 


897 


n 


MANUFACTURES     READY    FOR 
CONSUMPTION 


RAW  MATERIALS    OF  AGRICULTURAL 
ORIGIN 


1909 


OTHER    RAW    MATERIALS 


Diagram  No.  1 


RUSSIA —  HER  ECONOMIC  PAST  AND  FUTURE 


It  was  natural,  therefore,  that  only 
after  relations  between  Russia  and  Eng- 
land had  improved  and  the  feeling  of 
distrust  had  given  place  to  a  policy  of 
mutual  confidence,  that  English  capital 
began  to  be  invested  in  Russia  on  a  large 
scale  and  to  enter  into  competition  with 
the  capital  of  France,  Belgium  and  Ger- 
many, which  had  been  for  the  previous 
two  decades  the  most  important  factors 
in  the  development  of  Russia's  natural 
resources. 

Many  branches  of  Russia's  most  im- 
portant industries,  especially  metallurgy 
and  mining,  were  for  a  long  time  largely 
controlled  and  built  up  by  French  and 
Belgian  capital.     During  recent  years, 


*  The  period  from  1909  to  1914  was  marked  by 
enormous  progress  in  Russia's  industrial  develop- 
ment. But,  unfortunately,  there  is  no  statistical  data 
available  for  this  period. 


however,  the  accumulation  of  financial 
resouces  in  Russia  itself,  as  we  shall  see 
later  (diagrams  Nos.  60,  61  and  62), 
brought  about  a  partial  repurchase  of 
these  enterprises  by  Russians. 

Due  to  the  accumulation  of  capital  in 
Russia  itself,  Russian  economic  life 
made  marked  progress.  We  may  point 
in  this  connection  to  diagram  No.  1,  from 
which  may  be  seen  that  the  total  value 
of  the  agricultural  products  of  Russia 
increased  from  4  billion  in  1895  to  9|/2 
billion  roubles  in  1910,  whereas  the  total 
value  of  manufactured  products  in- 
creased only  from  2.8  billion  to  4.9  billion 
roubles  for  about  the  same  period.* 

The  progress  of  Russia's  agricultural 
development  may  be  attributed,  to  a 
considerable  degree,  to  the  fact  that  the 


A(^(}recjafe  Eypendlfure  of  fhe 
Russian  Ministry  of  Agriculture 
for  the  65  years  from  IdiSto  I90Z 
and  for  the  DecaolefromBOifolBIZ 

18.9 


0U-| 

I 1 

7/7 

70- 

«) 

<u 

s>(,0- 

lOYears 

o 
"^50- 

18951902 

CM 

r^ 

°ri 

u- 

^ 

o 

40- 

10  Years 

"^ 

c 

18851692 

r< 

O30- 

^20- 

ZOYecirs 

''I 

= 

c 

18651882 

10- 

Jbfears 

<\j 

A 

I856I8K 

"0 

5  Years 
1908-1912 


BYe^rs 
190M907 


Annual  Average 

Expenditure 

(In  Millions   of 

Roubles) 


23 
22 
21 
20 
19 
18 

n 
le 

15 
14 
15 
12 
II 
10 
9 


1908- 1912 


1905-1907 


1695-1902 

1865-1892 

1875-1682 
1865-1872 
1858  1862 


Id 

0.9 

5a 

- 

Russia's  Annual  Expenditure 
for  the  Development     of 
Agriculture 


BY  THE  DEPARTMCNT 

OF 
A6RICUL  TURE 

\ 

j^Q           BY  THE  LOCAL 

SELF60VERNMENTS 
(ZEMSTWOS) 

16 

2 
I 1 

0.9 

40 


30 


20 


(S»  — 


Numbers  of  Persons  engaged  in 
Promoting  the  Agricultural. 
Development  as  Advisers, 
Instructors,  etc. 


ZEnSTWOS 


1266 


BY   THE 

CENTRAL 

GOVERNMENT 


lies 


54 


Ml 


S9S 


360 


-3000 


-2000 


1000 


CvJ  — 


o  — 


Diagram  No,  2 


10 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


Government,  as  well  as  the  Zemstvos,* 
have  only  in  recent  years  understood 
that  substantial  subsidies  are  indispens- 
able to  insure  the  development  of  the 
productive  forces  of  the  country. 

The  average  annual  budget  of  the 
Board  of  Agriculture,  as  shown  in  dia- 
gram No.  2,  gives  the  following  expen- 
ditures. 

Years 

1838-1862 about    0.3  million  roubles 

1903-1907....     "        4 
1908-1912....     "       12 


The  number  of  technical  advisers  and 
instructors  employed  by  the  Board  of 
Agriculture  and  the  Zemstvos  very 
greatly  increased,  as  shown  in  the  same 
diagram. 

A  very  important  factor  in  the 
growth  of  Russian  agriculture  during 
recent  years  was  the  constantly  increas- 
ing number  of  various  agricultural  as- 
sociations and  co-operative  societies, 
due  to  a  more  liberal  governmental  pol- 
icy in  that  Department.  As  shown  in 
diagram  No.  3.  from  January   1,   1909, 


Number  of  A(jriculi-urctl 

Associa-Hons 
(Af  the  beqinninq  of  1914) 


5000 -, 


4.000 


3.000 


eooo 


1.000  - 


<685 


Crea ted 

offer 

Jan.  1, 1909 

2961 

(63.3°/o) 


Created 
1902-1907 

1275 
(27.2%) 


Created  before 
1902 


(443 

m5% 


Number   of  Agricu/furcff 

Cooperative  SocieHes 

(Ai  the  be^innmg  of  1914) 


1254 


106 
90 


Created 
1913 
289 


Crea+ed 

1910-1912 

769 


Created  I9OT-0S 


ICre(it« 
before 
1902 


•1500 


1000 


500 


Number     of     Agricu/tura/    Cooperp-f-ive 
Socie'ties     (Piccorc^ing     to      i-heir 
Respec-five     Business 


o 


COOPERATIVE  SOCIETIES 

FOR  5ENERAL  TRADING 

PURPOSES 


COOPERATIVE  SOCIETIES 
FOR   THE  PURCHASE 
AND  USE  OF  AGRICULTURAL 
MACHINERY 

•  ALL    OTHERS 


Diagram  No.  3 


In  the  year  preceding  the  War  the 
Department  of  Agriculture  spent  30 
million  roubles  for  developing  agricul- 
tural productivity,  a  larger  sum  than 
was  spent  by  the  Board  for  the  entire 
period  of  45  years  from   1838  to   1882. 


*  Local    self-governmental    bodies    created    after 
the  liberation  of  the  peasants. 


to  the  beginning  of  1914,  there  were 
created  2967  agricultural  associations, 
practically  two-thirds  of  the  total  num- 
ber of  such  associations  in  Russia  at 
the  end  of  1913.  There  was  an  ap- 
proximately equal  increase  in  the  num- 
ber of  agricultural  co-operative  societies. 
Out  of  the  total  number  of  1254  of  such 


RUSSIA —  HER  ECONOMIC  PAST  AND  FUTURE 


11 


societies  in  existence  at  the  beginning  of 
1914,  1058,  or  about  four-fifths,  were 
founded  during  the  last  four  years. 

There  was  also  considerable  progress 
during  the  period  from  1897  to  1909  in 
the  development  of  industries  in  Russia, 
as  shown  in  diagram  No.  4.  The  aver- 
age annual  output  of  iron  ore,  pig  iron 
and  coal  for  the  years  1902-1903,  com- 


pared with  that  of  1912-1913,  was  al- 
most doubled,  and  the  production  of  cop- 
per almost  quadrupled  during  that  pe- 
riod. Oil  was  the  only  product  which 
showed  a  decrease;  this  was  caused  by 
the  exhaustion  of  certain  oil  deposits, 
and  also  by  the  restriction  of  output, 
due,  in  its  turn,  to  the  short-sighted  pol- 
icy of  the  government,  concerning  oil- 
lands. 


f^oducffon 

Annual     Averae^e 
Production  of   Iron    Ore.  Pia  Iron. 

of  Copper 

20n 

Oil  ctn<pl  Cocff    in    Russict 

r40 

COAL 

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CM       OJ                        C^        (M                       CJ       OJ            '                  (NJ 

^2?                 5?      ^                G^     c^                     c^ 

g^                  (y>(j\ 

Diagram  No.  4 


CHAPTER  II. 


Cultivation  of  Grain-Foodstuffs  and  Russia's  Role  in  the 
World  Market — Cattle  Raising — Industrial  Production 
— National  Wealth — Comparison  with  Other  Countries, 
Especially  with  the  United  States. 


IN  showing  the  progress  of  Russian 
agriculture,    as    represented    by    its 
chief  product,  grain,  we  draw  atten- 
tion to  the  figures  in  diagram   No.   5, 
which  illustrates  the  increase  for  con- 
secutive three-year  periods  from   189.S- 


1897  to  1910-1912.  The  annual  produc- 
tion grew  in  18  years  from  3.1  billion  to 
4.4  billion  poods,  an  increase  of  approxi- 
mately 42%.  The  first  section  of  this 
diagram  shows  also  that  the  increase  in 
the  average  yield  applied  to  lands  owned 


Annual   Yield    of  Grains      in     50                         Total  Producii 

on   of  all  Grains 

Governments  of  European      Russia                                         in     Russia***^ 

54  -, 
52  - 

(1861-70     —     1900-1910) 

E4 

(Annual 

Ave  rag  es  ) 

50  - 

LANDS  OWNED** 

i-R 

48- 

PEASANT  LAr^DS*         %S,%'^;^1^       47 

4G- 
(3  44- 

42 

4.4 

H-40- 
C38  - 
■«)36  - 

59 

r^ 

%! 

4.1 

0 
a 

37 

3.6 

54 

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33 

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*^ 

^^ 

■-^ 

'■^ 

"^^ 

^^ 

^^ 

— 

6  - 
4  - 

^ 

I 

1 

1 

1 

^ 

I 
§1 

1 

1 

^ 

1 

c:i 

50 

5) 

^ 

SP 

<5l 

<Q 

'^ 

2P 

^ 

(y. 

59 

°D 

<s^ 

<Si 

<3^ 

S^ 

2  - 

^ 

--^ 

--^ 

^ 

^^ 

^-v 

'^ 

^-s 

'^ 

~-v 

■~^ 

•^ 

iij 

u 

u 

*  Lands  e^iven  to  the  peasants  after  their  liberation  from  serfdom. 

The  title  to  such  lands 

belonged  always   to  the  peasant  class. 

**Eifher  by  landlords     or  peasants. 

**%AII  empire  not  includinc^    Transcaucasia,  Eastern  Siberia,   Turkes 

tan  and    UraJ  Reqion. 

niagram  No.  S 


14 


RUSSIA  ~  HER  ECONOMIC  PAST  AND  FUTURE 


Russici's  part  in    World's 

™ 

Part  of  various 

m 

Russia's  part  in 

25%  T 

Produciion  of  Grains*''^ 

1 

Grains  in  World's 

m 

Worlds  Production 

total  Production                          of  various  Grams 

- 

5    ^ 

(Averages    for      1901  -    1912) 

- 

N~i 

— — 1 

^   <^    a    <s.         1 

1.8* 

' 

^ 

o    r-j     _-■ 

C  J  1 1  S^ 

^^■"^                 "-^^^ 

20%' 

y^       W              ^^\ 

- 

/                      V          ^          ^\ 

- 

/            ^         v               '^             \ 

/  0^/  1   %;,  \ 

15%- 

/           u      <i^           Ao\o^           ^                  \ 

/Productiom               ^^-;^^77777/7> 

ll9,feOO,000,OOC^^^^^^^ 

I0%- 

^..r^^po^/dsy^^M^^^* 

r- 

Ci 

t^^ 

VS 

«3^ 

CM 

116^^^-^r  jS~%>y      ^^ 

^ 

c> 

o 

^ 

O 

\%      "^^J^^        1^^             \^             / 

^ 

cr, 

c^ 

cyl 

<3l 

<s^ 

5%- 

1 

1 

1 

1 

1 

1 

^\   Jw^v        l^^o  ^    4^  / 

<0 

°0 

o 

<5^ 

^^^i    HJ/ 

^ 

^^ 

*^ 

^^ 

* 

•X^le^^^^^                       W/YA^^^'^^ 

'            ^4^* 

A% 

Q/0- 

,    „        ^          ^     .          ^  D      1                 '^  Russic^'s  part  in  Percentage  of 
Wheat-.  Rye,  Corn,  Oats  and  Barley.                Worlds    Production  of  indicated 

Grain   Crop. 

Diagram  No.  6 


by  the  peasants,  as  well  as  to  the  hold- 
ings of  the  gentry. 

In  discussing  the  progress  achieved 
in  Russian  agriculture  it  is  important  to 
point  out  that,  regardless  of  the  ap- 
pearance in  the  world  market  of  a  num- 
ber of  serious  competitors,  such  as  Ar- 
gentine, Canada  and  Australia,  Russia's 
participation  in  the  world's  production 
of  the  five  principal  grains  (wheat,  rye, 
corn,  oats  and  barley)  was  only  slightly 
afifected  (See  diagram  No.  6).  Russia's 
share  in  the  world's  production  of  each 
of  these  grains,  separately,  is  indicated 
in  the  second  section  of  the  same  dia- 
gram.    The  relative  importance  of  the 


Production  of  Cereals  in  Russia 
(Averages  for  1895-1912) 


Diagram  No.  7 


*  Millet,   Buckwheat,    Peas,   Spelt,  Lentil  and   Beans. 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


15 


above-mentioned  foodstuffs,  as  well  as 
of  other  agricultural  products  in  Russia, 
is  shown  in  diagram  No.  7.  Diagram 
No.  8  shows,  in  its  first  section,  how 
rapidly  the  importation  of  agracultural 


machinery  and  implements  was  growing 
in  Russia,  in  recent  years.  While,  be- 
fore 1900,  the  value  of  these  imports 
never  surpassed  15,000,000  roubles,  and 
for  the  five-year  period  of  1895  to  1899 


Value    of 

Railroad  Transporfafion 

p40 

Aqriculfurcrl 

of  A^riculfura  1 

-33 
-36 
-34-2 

fmporfs       info     Russia    of  Africa  If  ural 
Machinery      anc/      Im  pleme  nfs 

Machinery  anci' 
Implemenfs 
Manufacfured 

Machinery   &  Implemenfs 
(1695    -    1912)    r- 

{IS95    -    1912) 

In 

in    Russia 
(I69S  a-  1912)* 

in 

^ 

-32  o 
-30o 
-28'^ 

"^  Rj 

S 

-26 

m  60-1 

'nl — 1 

c\i 

— 

-  24;,. 

^65- 

in 

-22  o 

D  50- 

•^ 

-  20 

^45- 

§1 

-I8« 

40- 

r^ 

=0 

-  16  c 

iv  35- 

°  30- 

25- 

^20- 

is>    to    "o    ^ 

<3  a  ci  oo 

1^ 

K 

Ob 

5^ 

-  14  o 
-12- 
-10- 

-  6^ 

in  r^    iJl 

-m— 

.9  15- 
r  10- 

§ ;;:  ^  ^ 

1.0 

n 

-  6 

-  4 

-  2 
>-    0 

m\©r-«0<3^0    —    cjro'3'     mt^r~co'5io    —    OJ 

in             cJ 

m         o          in         o         (M 

(f3^<J>cS><3l<3^00000     O     OOOO    —     —    — 

CT>          — 

CTl           O           O           —           — 

coeoco<o<c<y)(3^<s><5>^    d    <riC>er»(5>c^oi<s^ 

<0               01 

<o        c>        o^        oi       a> 

*  Nof  includincj    small     hanc 

/-  working   shops. 

Diagram  No.  8 


I8i 

RUSSIA 

•»5 

Annuel  1    Averexye    Wheat    Yielol  for 
>                    the    Ptriod     of    1901  -  1910 
(In  "  Pooo/s"  per  Pessiat/naJ 
62 

S£RVIA                           Si 

SPAIN 

BULOAKIA 

62 

16 

ITALY 

HU  N  0  *  li  Y                                   1 

ROU  MA N 1 A 

19 

AUSTRIA 

85 

F  R  A  N  C  C 

90 

SWEDEN 

IBS 

6  E  R MA N  Y 

110 

4d 

6R  £  AT        BR  1  TAIN                                                                   ]/■ 

HOLLAND 

ISi 

BILSIUM                                                                                      'SI 

DENMARK                        (l90l  -  05 ) 

1                            1                           I                            1                            1                            1                            1 

0                    25                   50                  75                  100                  125                 150                 175 

totaled  only  53,000,000  roubles, 
in  both  191 1  and  1912,  the  imports 
of  agricultural  machinery  and  im- 
plements greatly  exceeded  these 
sums.  The  same  may  be  stated 
concerning  the  manufacture  of 
agricultural  machinery  and  im- 
plements in  Russia  itself.  From 
1895  to  1912  the  manufacture  of 
these  products  increased  SYi 
times. 

Under  the  influence  of  compar- 
atively low  freight  rates  on  the 
railroads,  the  activity  of  the 
Zemstvos,  and  the  gradually  ris- 
ing standards  in  public  instruc- 
tion, the  use  of  agricultural  ma- 
chinery began  to  spread  over  the 


Diagram  No.  9 


16 


RUSSIA —  HER  ECONOMIC  PAST  AND  FUTURE 


Annual  Average     Yield     of     Whea+ 

per   Acre    in      Bushels 

(190  7  - 1913) 

25-1 

M 

20- 

«0 

^^ 

ixi      ^     r~~i 

15- 

VSi             ^-             *< 

10- 

^ 

5 

1 

5 

-J 

i 

<r 

5- 

5 

in 

5. 

^ 
K 

? 

K 

^ 

? 

§ 

o 

,-\ 

IK 

"t 

CQ 

'i: 

o 

4: 

U 

Diagram  No.  10 


whole  country,  as  may  be  seen  from  the 
fact  that  the  railway  transportation  of 
these  products  grew,  from  1895  to  1912, 
from  2,9  to  29,7  million  poods,  that  is, 
over  10  times. 

These  facts  explain  the  above  men- 
tioned increase  in  the  productivity  of 
agricultural  labor  in  that  country. 

The  diagrams  referred  to,  demon- 
strate that  Russian  agriculture  has 
made  notewforthy  progress  during  re- 
cent years,  but  its  productivity  was. 
nevertheless,  much  lower  than  that  of 
other  countries.  Diagram  No.  9  clearly 
indicates  that  the  average  w^heat  yield  in 
Russia,  per  acre,  is  about  one-half  of 
that  of  Austria  and  France,  one- 
third  of  that  in  England  and  Germany 
and  about  one-fourth  of  that  in  Den- 
mark, in  spite  of  the  fact  that  the  soil 


2600 

2700 -] 

2600 

2500 

2400  - 

2300 

2200 

2100 

2000 

1900 

1800 

noo 

1600 

1500 

1400  H 

1300 

1200 

1100 

1000  - 

900  - 

SOO 

700  \ 

SCO 

500 

400 

300 

200 

100 
0 


CORN 

2100 


Crops  in    Russia   (Pind  in    the  United  States 
(Annual    Averages   for   the    Years  1911 -li) 


POTATOES 

1268 


RYE 

oo 
oo 

0  O 

oo 

955 

oo 

o  o 

O  0 

oo 

00 

oo 

OO 

oo 

oo 

OO 

oo 

oo 

oo 

oo 

oo 

oo 

^ 

oo 

oo 

00 

oo 

oo 

oo 

oo 

oo 

oo 

57 

oo 

oo 

mni 

oo 

594 


148 


161 


UNITED    STATES 


OATS 


BARLEY       WHEAT 


1154 


1051 


105 


FLAXSEED 


24i  21.6 
-CQQxanL. 


16 


Total  of  all  mentioned 
Crops 

(In Millions  of   Bushels) 


5163 


4691 


00  0  0  o  o 

o  o  o  o  o  o 

o  o  o  o  o  o 

o  o  o  o  o  o 

o  o  o  o  o  o 

o  o  o  o  o  o 

o  O  O  0  o  o 

o  o  o  o  o  o 

o  o  o  o  o  o 

0  o  o  o  o  o 

o  o  o  o  o  o 

o  o  o  o  o  o 

0  0  0  o  o  o 

O  O  O  0  •  o 

O  O  o  o  o  o 

o  o  o  o  o  o 

O  O  o  o  o  o 

O  O  0  o  o  o 

GOO  00   O 

o  O  o  o  o  o 

O  O  O  O  O  O 

O  O  o  o  o  o 

o  o  o  o  o  o 


Total  Acrea<^e 
unc^er  all 
menHoneci 
Crops 


209 


r500 

-260 

240  1^ 

1-220  o 

200^ 

iso^ 

160  ° 

140 

120^ 

-100  o 

bOzz 

eor 

40^ 
20- 


Diagram  No.  11 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


17 


in  many  parts  of  Russia  is  much  richer 
than  the  soil  of  the  majority  of  the 
countries  of  Europe,  all  of  which,  to- 
gether, have  hardly  as  great  a  belt  of 
"black  soil"  as  European  Russia  has. 

In  comparing  Russia  with  her  most 
important  competitors  in  the  world's 
market,  we  find  (diagram  No.  10)  that 
they  all  have  higher  yields  per  acre 
than    Russia, — Canada's    average    yield 


of  wheat  per  acre  being  almost  twice 
that  of  Russia. 

The  figures  showing  the  average  pro- 
duction of  the  most  important  grains  and 
of  potatoes  in  the  United  States  and 
in  Russia  are  given  in  diagram  No.  11. 
These  figures  show  that,  notwithstand- 
ing the  fact  that  Russia  had  under  cul- 
tivation an  area  about  23  per  cent 
greater  than  that  of  the  United  States, 


To-tcil      Value    of    Ac^riculfurotl     Producis      in         Russia 
anc^    fhe     Unii-ec/    S-ha-tes    for    flie    Year    1910"^ 


Value  of  Aofriculfural 
Production  per  Capii-a 
of  Rural**  Qio 
Pop  u  la  Hon     k  }ii 
^5 


225n 
200- 

200 

'^  175- 

*-  150- 
^  125- 

-  100- 

o     "^5- 

o     50- 

25- 

0^ 

<0 

::> 

30 

U 

^Nof  induding  fisheries  and  foresis. 

*  *  for  the  United  States  "urban" population 
includes  all  incorporated  places  havin(^ 
2500  or  more  inhabitants. 
Total  population  exclusive  of  "urban''  is 
named  in  America  '^ rural" population . 
In  Russia  many  places  havinc^  5000  or  more 
inhabitants  trecfuently  are  classifed  as 
"ruraf"  districis.    To  make  a  fair  comparison 
fhe  actual  "rural" population  of  Russia  was 
therefore  reduced  by  about-  5 perceni: 


Diagram  No.  12 


18 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


NUMBER  OF  CATTLE 

(6  Sheep  or  3  Hoqs  are  taken  as 
being  eauivalenf  fo  I  Heacp/  of  Caff fe) 

5610 


PER  1000  OF 
POPULATION 


5G60 


PER  1000 
HECTARES 
UNDER  WHEAT, 
RYE,  BARLEY, 
OATS,  CORN  AND 
POTATOES 


600 


960 


\- 

4 

\- 

tf^ 

Q 

< 

LJ 

(0 

1- 

U5 

Z 

3 

■z> 

CC 

< 

z 

1- 
z 

o 

< 


< 

(- 
in 

< 


< 

< 

Z 
< 


to 

Q 


Diagram  No.  13 

the  total  average  crop  of  all  these  prod- 
ucts in  the  latter  country  was  fully 
10  per  cent  higher  than  in  Russia. 

This   striking  backwardness   in   Rus- 
sia's agricultural  productivity  is  shown 


still  more  clearly  in  dia- 
gram No.  12,  in  which  is 
given  data  concerning  the 
total  value  of  agricultural 
products  in  Russia  and  in 
the  United  States,  as  well 
as  the  value  of  agricultural 
products,  per  capita,  of 
population  in  both  coun- 
tries. 

At  the  time  that  the  an- 
nual per  capita  value  of 
agricultural  products  was 
$30  in  Russia,  it  was  about 
$200  in  the  United  States, 
almost  seven  times  greater. 

One  of  the  chief  causes 
of  such  low  productivity  of 
agriculture  in  Russia  ap- 
pears to  be,  in  addition  to 
limited  application  of  agri- 
cultural machinery,  the 
negligible  amount  of  live 
stock  per  capita,  as  well  as 
per  unit  of  cultivated  acre- 
age. The  figures  in  dia- 
gram No.  13  show  that, 
while  for  every  1000  inhab- 
itants in  Argentine  there 
are  5320  head  of  cattle,  and 
in  Australia  4600,  Russia 
has  only  390  head  of  cattle 
per  1000  inhabitants,  i.e., 
about : 

14  times  less  than  in  Argentine 
12  times  less  than  in  Australia 
2J4  times  less  than  in  Canada. 
254  times  less  than  in  the  U.  S. 
When  it  is  considered  that   the  live 


110 


a. 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


19 


stock  belonging  to  the 
peasantry  in  Russia  is  of 
inferior  quality  a  n  d 
weight,  the  difiference  in 
iavor  of  the  other  countries 
will  appear  still  more  strik- 
ing. 

Since  there  was  practi- 
cally no  use  of  artificial 
fertilizers  in  Russia,  this 
small  number  of  cattle  was 
one  of  the  principal  causes 
which  hindered  the  prog- 
ress of  Russian  farming 
and  agriculture. 

What  bright  prospects 
there  are  in  store  for  Rus- 
sia may  be  easily  seen  from 
diagram  No.  14,  which 
shows  that,  of  the  entire 
land  area  of  Russia,  there 


« 


700-1 
675- 
feSO 
625 
600 
575 
t  550 
*■  525 
«   600 

«  450- 
*  42  5- 
Q  400 
J75 
V   350- 

0  J2  5 
300- 
275 

■"  250 

1  225 

-  200 

-  150 
f    125 

100 

75- 

50 

25 

0 


Total     Area     and      Area      under     Culfiva-tion 

in       various     parts     of     Russia 

:n       1912 

6411  _Jfi65^ 


I       I  CULTIVATED   AREA 
^MuNCULTIVATED    AREA 


SOS  3 


4415 


»4l.O 


^  II& 


202S 


izrz 


Diagram  No.  14 


75 
70 
65 

60 

o 

V- 

50  -\ 

40 
(/) 

c  35 
o 

£  30 
£  25 

e20 

15 

10 

5 

0 


Proc^ucfion    of  Iron  Ore,    Piq    Iron    prnd   Oil 
{ Annual  Averages  for  the  Years  1912- 1913) 

\UNITED   STATES 


\%%%\RUS5IA 


IRON  ORE 

Gil 


IRON  ORE 

0.62 


PI 6    IRON 

iO.9 


OIL 


6.9 


o  ooo 
oooo 
oooo 
oooo 
oooo 
ooqo 


4.^ 


oooo 
oooo 

"OOP 


29 


9.2 


OOOO 
OO  O  o 

oo  o  o 
oo  o  o 
oooo 
oooo 


52% 


1023 


PIG 
IRON 

0.5IS       OIL 
0.296 


COS 


o  o 
oo 
o  o 


0.025 


0.05 


o  o 
o  o 
o  o 


0.75 

-0.1 

-0.65 

-0.6   ^ 

hO.55  c 
o 

^-05  ^ 
-0.45  f 
-0.4 

0.35 +- 
-0.3 
-0.25 

-o.z 

0.15 
0.1 
hO.GB 
0 


ex 


Diagram  No.  !5 


20 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


was  under  cultivation  in  1912: 

In  European  Russia. 17.5% 
In  the  Caucasus.  .  .  .20.3% 

In  Turkestan 1.9% 

In  Steppes  provinces  1.3% 
In  Western  Siberia  .  1.07o 
In  Eastern  Siberia.  .    0.1% 


Throughout  Russia.   5.2% 

Thus  95%  of  Russia's  land  area  was 
uncultivated,  and  this  points  unmis- 
takably to  the  immense  possibilities 
latent  in  that  country  for  cattle  raising", 
and  farming  as  well.  If  only  one-fifth 
of  Russia's  land  were  made  adaptable 
for  cultivation,  through  reclamation,  ir- 
rigation, well-directed  colonization  and 
the  construction  of  railroads  and  other 
means  of  communication,  Russia's  pro- 
duction would  increase  at  least  four- 
fold. 


750-1 

Pro(plucfion    of  Copper,  Leac^ 
anc?l     Zinc 

700- 

(Annuel!    Averaqes    for 
the  Years  1912 -1915) 

650- 

600- 
in 

§550- 

1- 
500- 

COPPER                 ^^ 

562.5            ^  ^''^^'^ 

[: 

^^UNITED  STATES 

<<-450- 
o 

LEAD 

400- 

iGO 

ZINC 

(5 
i/)300- 

°250- 
h- 
200- 

296 

^150- 

100- 

50- 

n  — 

34 

1.5 

II.Z 

Diagram  No.  16 


"^UNITED  STATES 


RUSSIA 


40 

38-1 

en  30. 
o  34 
=  52- 

28 
C26 
24 
22 
20 

6 

6 

4-1 

2 

0- 

6- 

G 

4- 

2- 

0 


a; 
ex. 

CO 
o 


E 

D 


COTTON    INDUSTRY 
(Year  1915) 

50.53 


3.96 


ooo 
ooo 
ooo 
ooo 
ooo 
ooo 


0.5/ 


0.05 


ooo 
ooo 
ooo 


0.50 
045 


\  040  g- 

hO.55 


-0.50 


a_ 

[-0,25-G 

c 

I-  0.20  ^ 
0.15  o 


0.10.^ 


1-0.05 
0 


20 
19 
18 
17 
16 
5 

CO  13 
2 


(U 


o 

in 

c 
o 


10 

9 

8- 

7 

(o- 

5 

4 

3 

2 

1 

0 


COTTON  PRODUCTION 

(Annuel I  Averc?f<^e 
for  the  Ye  Of  r 5 
1912  - 1915) 


15.9 


0142 


1.0 


ooo 
ooo 


o.ooe 


rO. 

0. 

0. 

0. 
-0, 
-Q 
-0. 

0 

0. 
f-0. 

0 

0. 

0, 

-a 

-Q 
0. 

-0. 

-0, 
0 

hO. 
0 


20 

19 

18 

17 

16 

15  C 
.14± 

13  ^ 
.12u 
,11 

.10  ^ 
.09  ^ 

07  0) 

06  c 

05^ 

04 

,03 

.02 

01 


Diagram  No.  17 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


21 


Yet,  no  matter  how  great  Russia's 
backwardness  may  be  in  the  field  of  ag- 
riculture in  comparison  with  the  pro- 
ductivity of  the  United  States  and  its 
extensive  system  of  land  cultivation, 
com])arison  becomes  still  less  favorable 
to  Russia  when  applied  to  her  indus- 
trial developments.  By  comparing  the 
total  production  of  coal,  pig  iron,  cop- 
per, lead,  zinc,  oil  and  cotton  in  the 
United  States  and  Russia,  as  well  as 
the  total  horse-power  developed  in  the 
industries  of  these  countries,  we  find  (see 
diagrams  Nos.  15,16,17,18),  that  the  per 
capita   output   of   these   products   was: 

For  coal 27 

"     iron  ore   12 

"     pig  iron   12 

"     oil    6 

"     copper    30 

"     zinc 47 


times  greater  in  the  United  States  than 
in  Russia. 

The  same  unfavorable  proportion 
holds  good  in  relation  to  the  other 
l)roducts  mentioned  above,  particularly 
lead  and  cotton,  as  well  as  other  metals 
and  minerals,  on  the  extensive  produc- 
tion of  which  is  based  the  economic  de- 
velopment of  a  civilized  countrv. 

How  small,  in  comparison  with  the 
United  States,  is  the  value  of  Russia's 
industrial  products  is  shown  in  diagram 
No.  19.  It  barely  reached  160  dollars  per 
capita  in  Russia  in  1909,  while  in  the 
United  States,  the  average,  per  capita, 
amounted  to  approximately  2280  dol- 
lars,— 14  times  greater. 

The  direct  result  of  such  low  produc- 
tivity in  Russian  agriculture,  as  well  as 
in  her  industrv,  is  that  Russia  has  re- 


0  o  o 

ooo    RUSSIA 


UNITED     STATES 


ProduQ+ion       of 
Coal 
000-1  (^'^'^'-"^^^v^^'^'il^  ^or  the 


550- 

500 
to 

C450H 
o 

^400- 

Cf-550- 
o 

300 
o250 
^200 
^  150H 
-  100 
50 
0 


Yecfrs  I9I2-I9I5) 


5.12 


502 


54 


OOO 

ooo 


0.19 

lo  o  o 


6.0 

5.5 

5.0 

•4.5  ^ 


o 

1- 


-4.0 


5.5 


-5.0+- 


50- 
48- 
46- 
44- 
i-42- 

|40 
o  56 
^56 
J)  34 
o  32 
3:30 
28 
^26 


24 


ti- 

cc 

2.5 

cs 

« 

20 

0 

Z. 
0 

18 

2.0 

Ife 

1- 

— 

14 

1.5 

r 

12 
10 

1.0 

c 

8 
6 

0.5 

4 
2 

0 

0 

Di 

agram 

No. 

18 

Horsepower  usec^  in 
Manufac-turinq  Industries 
(Yecir  1914) 


22.5 


0.23 


0.0/4 


r0.40 
-0.58 
-0.36 
-0.34  ^ 
-0.52  4: 
-0.30'q_ 
-0.28,^ 
-026 
-0.24  !. 
-022  "^ 
-020 
-0.18  ^ 
-016  <i} 
-014  5 
-0.12  g. 
-0.10  <o 

-0.08  t 
-0.06  o 

-0.04 
-0.02 
J-O 


22 


RUSSIA  -  HER  ECONOMIC  PAST  AND  FUTURE 


mained,  always,  practically  a  pauper 
country,  notwithstanding  her  colossal 
resources.  This  is  shown  by  diagram 
No.   20,   which   compares   the   national 


*The  approximate  growth  of  the  national  wealth  of 
the  United  States  from  1912  up  to  1918  is  shown  by 
the  heavily  shaded  portions  of  the  columns  referring 
to  that  country.  The  national  wealth  of  the  European 
countries  indicated  in  this  diagram  has  rather  dimin- 
ished during  the  period  of  the  War,  as  they  were  far 
less  favorably  situated  than  the  United  States,  without 
counting  the  fact  that  they  entered  the  War  much 
earlier  and  therefore  necessarily  sacrificed  a  great 
deal   more. 


wealth  of  the  most  important  countries 
of  the  Old  and  Xew  World  before  the 
War.*  Upon  examination  of  these  fig- 
ures we  observe  that  the  national  wealth 
of  Russia,  though  her  population  was 
much  greater  than  that  of  any  country 
referred  to  in  this  diagram,  was  much 
less  than  that  of  other  countries,  partic- 
ularly than  that  of  the  United  States. 
Considering  the  figures  for  the  national 
wealth,  per  capita,  we  find  that  the  per 


Value       of     the      Manufaci-urec/    Proo/ucfs    in    Russia 
cinei    f/re     Unifed     Sfa-tes* 


*  Data  for  Russia  are 
fal<en  from  an  official 
report  published  by  the 
tlinisfry  of  Aqriculrure. 
Data  for  fiie  United  Sfafes 
are  taken  from  ttie  abstract 
of  the  census. 


Value  of  the  Inolustrial 

Production  of  Russia  anc?l  the 

On/ted  States 

(In  Dollars  per  Capita) 


2500n 


?.ooo- 


1500- 


o 

Q 


1000- 


500 


UNITED 
STATES 


RUSSIA 


<Si    o 
CO     <s> 


Diagram  No.  19 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


23 


capita  wealth  of  Russia  was  six  times 
less  than  that  of  the  United  States  or 
Eng-land  and  four  times  less  than  that 
of  Germany. 


tThe  number  of  persons  engaged  in  Russia's 
mines,  factories,  plants  and  shops,  was  estimated, 
before  the  War,  at  3  to  3'/>  million,  whereas  the 
number  of  home  workers,  in  villages,  towns  and 
cities  amounted,  probably,  to  7  or  8  million. 

To  this  preponderancy  of  home  workers  is  due 
the  fact,  as  shown  by  diagram  No.  18,  that  the  per 
capita  horse-power,  used  in  industry,  was  about  16 
times  less  in  Russia,  than  in  the  United  States. 


The  same  may  be  said  concerning  the 
annual,  per  capita  income  of  Russia's 
population.  The  lack  of  concentration 
in  industry,  which  alone  permits  exten- 
sive use  of  machinery,  as  well  as  the  fre- 
quent use  of  hand  labor  in  many  indus- 
tries, and  the  backwardness  of  agricul- 
ture, have  all  contributed  to  make  the 
annual  income,  per  capita,  in  Russia,  six 
or  seven  times  less  than  that  in  the 
United  States. f 


320- 

NATIONAL        WEALTH 

r3200 

300- 

-3000 

260- 

-2800 

260- 

^       (In    Billions    of 

2400        P^^    C(pipitoi 

-2600 

240- 

H               Do/iars) 

H            (Doli<p,r5) 

-2400 

220- 
200- 

H//?/?                                                  i965 

H    200(. 
^     1 

1 

■2200 
■2000 

180- 

1620 

■1800 

160- 

-1600 

140- 

1500 

•1400 

120- 

■1200 

looi 

^      .n 

-1000 

80^ 

70       ^n 

■  800 

60- 

1— ---l 

-  600 

40- 

550 

-  400 

20- 

-   200 

n  - 

-    n 

u 

^   u 

2r 

r. 

TATES 
INGDO 

a       8 

1       ^       > 

^           ^           ^           ^           < 

V)             i,<:             2             UJ 

< 

Cl                 Q                <                 O                 — 

Q             Q             <             <-> 

u^          UJ          j:          z          u> 
t            t           a:            <            lO 

t^         ttf         s:         z 

—             t             q:             < 

to 

:z:            z:           UJ           ct            3 

Z            z            UJ            cr 

3 

3                   rD                  'O                   Ll_                   CC 

3             3             o             u. 

OL 

Diagram  No.  20 


CHAPTER  III. 


Foreign  Trade  and  Merchant  Marine — Items  of  Russia's 
Exports  and  Imports — Grain  Elevators — Comparisons 

with  Other  Countries. 


Till''    most    striking    phenomenon 
which   arrests  attention   upon   an 
examination    of    Russia's    foreign 
trade  is  the  shifting  of  the  main  vokime 
of  her  foreign  transactions  from  Eng- 
land to  Germany,  as  shown  in  diagram 


No.  21.  These  figures  prove  that, 
whereas  in  the  middle  of  the  last  century 
England's  share  in  Russia's  commerce 
was  twice  the  size  of  Germany's,  before 
the  War  Germany's  share  was  four 
times   greater    than    that    of    England. 


Enq/(Pin(p/s  (Pinc^  6ermanys    Share  in    Russia's  imporfs 
(In    PercenfcPtqe  of  Total   Imports) 


48.9 


ENGLAND 


GERMANY 


41.  e 


M.G 


29.2 


15.1 

P- 

\~ 

I 

Jo.  6 

-- 

, 

U 

1 



_- 

372 

M/^ 

I^.U 

15.4      : 



50% 


40% 


h  30% 


-  20% 


-  10% 


1846-1648  1898-1902  1903-1001  1008-1912  Jc^n.  1915 

toJune   1014 


Diagram  No.  21 


26 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


Germany's  participation  in  Russia's  im- 
port business  has  particularly  increased 
during  the  last  few  years. 

The  g-eneral  figures  of  Russian  exports 
are  shown  in  diagram  No.  22,  year  by 
year,  and  in  diagrams  Nos.  23  and  24,  for 
longer  periods.   It  may  be  observed  that 


imports  as  well  as  exports  were  making 
fairly  fast  strides  and  that  in  both  these 
branches  Germany  had  a  leading  part. 
In  discussing  this  participation  of  Ger- 
many in  Russia's  foreign  trade,  sight 
must  not  be  lost  of  the  fact  that  the  fig- 
ures given  in  these  diagrams  do  not  pre- 


en 


1600 


1400 


,200 


o  1000 
o 


o 


to 
o 


yL. 


600 


GOO 


400 


200 


0 


/ 

^  •« 

• 
/ 
/ 

f 

/ 
/ 

/ 

/ 

/ 

/ 

4 

:^9S. 

RTS__ 

**  •«« 

^-^J 

/ 
/ 
/ 
/ 

/ 

^ 

f 

/ 

/ 
/ 

JH^ 

^ 

/ 

^  — ' 

/ 

/ 

/ 

Russias    Foreign    Trcrcpfe 

O        —         CJr-OT:f-i-n(^I—         CO  O^ 

OOOOOOOOO  O 


O  — 


<5^ 


rO 


Diagram  No.  22 


RUSSIA  —  HER  ECONOMIC  PAST  .AND  FUTURE 


27 


Russia's       Foreiqn       Trade       wi'-hh      various       Countries 
(1909     -    1915) 


Diagram  No.  23 


1550 
1500 
1450 
1400 
1550 
1500- 
1250- 
1200 
1I50H 
1100 
1050- 
1000 
950-1 
900 
S50 
600 
750 
700 
650 
600-1 
550 
500- 
450- 
400- 
550 
500 
250  4 
200 
150-1 
100 
50 
0 


R  u  s  s  i  a  5         Imports 
1544 


and         Expo r f  s 


A    N   N   U  A    L 


EXPORTS 


ii5 


1901  -  I90i 


\^I9II   -/9/5 


69i 


544 


280 


O  O  O 
0  5  O 
O  O  o 


16     il  SJi 1 


76 


815 


O  OO 
O  OO 
O  Oo 

ooo 

OOO 

ooo 
ooo 

OOO 

ooo 
ooo 
ooo 
ooo 
ooo 
Ooo 
ooo 
o  oo 
ooo 
ooo 
ooo 
ooo 
ooo 
oo  o 
ooo 

Ooo 

ooo 
oo  0 
o  o  O 
ooo 


ANNUAL 


2/6 


123 


ooo 
ooo 
Ooo 


55i 


ooo 

O  Oo 
O   Oo 

ooo 
ooo 
Ooo 

O  oO 

Ooo 
ooo 
o  oo 

Ooo 

Ooo 
Ooo 

OOO 
ooo 
oo  o 
ooo 
ooo 


/    M   P  O   9   T  S 


592 


412 


no 


5.0   KO 


o  o  o 

o  o  O 

Ooo 

Ooo 

Ooo 


I2U 


625 


OOO 
OOO 

ooo 
ooo 
ooo 
ooo 
ooo 

Ooo 

o  oo 

O  Oo 

Ooo 
o  oo 
Ooo 
ooo 
ooo 
Ooo 
o  oo 
o  oo 


FOODSTUFFS 


CRUDE  AND 
UNFINISHED 
MATERIALS 


ANIMALS 


(1ANUFACTURES 
READY     FOR 
CONSUMPTION 


TOTAL 
E)(  PORTS 


FOODSTUFFS 


CRUDE  AND 
UNFINISHED 
riATtRIALS 


ANIMALS 


MANUFACTURES  TOTAL 

READY   FOR  IMPORTS 

CONSUMPTION 


Diagram  No.  24 


28 


RUSSIA  —  HKR  ECONOMIC  FAST  AND  FUTURE 


sent  in  full  the  actual  size  of  Germany's 
share,  as  a  considerable  part  of  the 
trade  was  directed  both,  to  and  from 
Germany,  through  Holland,  Belgium 
and  Denmark.* 

The  bulk  of  Russia's  exports  and  im- 
ports consisted  (diagram  No. 25),  princi- 
pally, of  raw  materials  and  foodstuffs,  of 
which  grain  products  alone  made  up  43 
per  cent  of  the  entire  exports  for  the 
five-year  period  of  1909-1913.  Among 
the  other  products  of  export,  the  most 
notable  were  timber,  eggs,  butter,  flax, 
hemp,  etc.  Russia's  imports  consisted 
chiefly  of  cotton,  wool,  machinery,  tools 
and  appliances,  metals  and  metal  prod- 
ucts. 

In  speaking  of  the  development  of 
Russian  foreign   trade,  it   is  important 


to  point  out  the  fact  that  under  the  in- 
efficient and  backward  policies  of  the 
old  regime  a  group  of  countries,  though 
only  recently  entering  the  world  mar- 
ket, have  to  a  considerable  extent 
caught  up  with  Russia.  It  is  sufficient 
to  give  in  this  connection  the  following 
facts  relating  to  the  foreign  trade  of 
Russia,  Canada,  Argentine  and  Japan: 

Years       Participation  in  World  Trade 

Russia         Canada      Argentine        Japan 


1890 

3.5% 

1.2% 

1.3% 

0.6% 

1896-1900 

3.4%, 

1.5% 

1.2% 

1.0% 

1901-1905 

z.y/c 

1.8% 

1.5% 

1.3% 

1906-1910 

3.2% 

1.8% 

2.0% 

1.4% 

1911-1913 

3.6% 

2.0% 

2.0% 

1.5% 

*For  further  information  on  this  matter  see  the 
author's  "America's  Opportunities  for  Trade  and 
Investment   in   Russia,"  New  York,   1919. 


By  comparing  the  shares  of  partici- 
pation in  the  world's  trade  of  Canada, 
Argentine  and  Japan,  it  appears  that  in 
1890  Russia's  share  was  larger  than 
their  combined  trade.     During  the  five- 


nost        important      Articles        of      Russict's       Exports       and       Im  ports 


aZ^ 


(1909    -    I9J3) 


13.7% 


W.ti'h 


Diagram  No.  25 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


29 


year  period  of  1896-1900,  however,  Rus- 
sia's portion  amounted  to  3.4%  of  the 
total,   whereas   the   combined   share   of 


these  countries  rose  to  3.7%.  In  the 
course  of  the  following  two  five-year 
periods,  Russia's  share  suffered  a  still 


Ru5sl(pfS      Expor-ts    o-T  Orceins 

for     the 

Yeorrs      /895/9e  -  /9I2//5* 

(Annual          Averag  e  5 

) 

800-1 

JN 

MILLIONS     OF                                    IN 

MILLIONS     OF 

- 

POODS 

ROUBLES 

— 

•^ 

^ 

700- 

00   ^^  tS 

C5^ 

— 

^      CS^      LrS      ^ 

'1) 

- 

^      ^      ^  1 

(bQO- 

^ 

■^  1 

« 

^ 

NO 

^ 

^   ^ 

500- 

V 

o 

SO 

c^ 

V 

<3^ 

Q> 

400- 

N>) 

QC5 

NO 

^ 

^ 

(5^ 

300- 

^ 

^ 

^ 

^ 

^ 

^ 
^ 

^ 

h- 

^ 

.^ 

^ 

^^ 

^ 

^ 

^ 

l<" 

c>r 

NO' 

^ 

QS^ 

CM 

200- 

^ 

^ 

^ 

^^ 

^ 

^ 
^ 

Qi 
^ 

^ 
^ 

— 

1 

1 

1 

1 

1 

1 

■^ 

^-^ 

"^ 

^>. 

100- 

^ 
co^ 
cy^ 

^ 

^ 

^ 
> 
^ 

1 

^ 
^ 

^-^ 
^ 

^ 
-^ 

50 

^ 

^ 

^ 

^■^ 

^ 

^ 

^ 

^ 

^ 

^ 

r\ 

[ 

0- 

^  Yi 

?ars  end'nc^     Au^usi-   51. 

Diagram  No.  26 


30 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


further  decline,  while  the  share  of  the 
above  mentioned  countries  increased 
materially.  During  the  three  years,  1911 
to  1913,  Russia's  participation  grew 
somewhat  and  rose  again  to  the  level  of 
1890;  but  the  combined  participation  in 
the  world  market  of  Canada,  Argentine 
and  Japan  increased  still  faster,  so  that 
their  share  in  the  world's  trade  was  at 
that  time  about  one  and  two-thirds 
times  larger  than  Russia's.* 

In    passing    to    a    discussion    of    the 


*During  the  War  Japan  and,  particularly,  Canada, 
have  made,  as  is  well  known,  extremely  large  gains  in 
their   foreign   trade. 


principal  item  among  Russia's  exports, 
grain,  we  draw  attention  to  the  analy- 
sis of  the  development  of  this  branch  of 
her  foreign  trade  in  diagrams  Nos.  26 
and  27.  Both  in  respect  to  quantity  and 
value,  the  grain  exports  showed  growth, 
though  far  from  equal  in  all  products. 
The  biggest  progress  was  made  in  the 
export  of  barley,  oilcake  and  bran,t 
whereas  the  increase  in  the  exportation 


tThere  has  been  considerable  discussion  concerning 
the  desirability  of  the  exportation  of  these  products, 
since  they  are  necessary  for  the  breeding  of  cattle  in 
Russia  itself,  and,  furthermore,  the  small  number  of 
cattle,  together  with  the  very  infrequent  use  of  artificial 
fertilizers,  has  hindered  the  development  of  the  agri- 
cultural productivity  of  the  country. 


Russias      Expori-s     oF     Grains  ,   Oilcoike     (Pin(p/     Broin 

(Annual       Ave  ha  g  e  s  ) 


300-1 


^250 
IS 
o 
o 
a. 
200 

U- 
o 

in  I50H 

c 
o 

Z  100- 
c     50H 


WHEAT 
CM 


0 


^ 
o 
^ 


50 


BARLEY 
°0 

O 

CM 


I 


OATS 


I 


!^ 


RYE 

CM 


I 


^ 


OJL  CAKE 


CM 

CM 


OTHER 
CEREALS 


CM 


Y 

^ 

v^^ 

^ 

S" 
^ 

-^ 

-SO 

1^ 

50 

^ 

CM 


°0 


( 


BRAN 
to 

CM 


Si 


CM 

c:i 

<3^ 


Diagram  No.  27 


RUSSIA— HER  ECONOMIC  PAST  AND  FUTURE 


31 


of  wheat  was  comparatively  insignifi- 
cant. The  slow  growth  of  the  wheat 
exports  is  explained  by  the  following 
two  causes:  First,  as  shown  in  dia- 
gram No.  IS,  the  cultivation  of  wheat  in 
Russia  was  relatively  very  small,  only 
seven  poods  per  capita  of  the  popula- 
tion against  40  poods  in  Canada  and  48 
poods  in  Argentine.  In  view  of  the 
rapidly  increasing  city  population  in 
Russia,  which  consumes  large  quanti- 
ties of  wheat,  this  product,  therefore, 
was  finding  an  ever-increasing  market  in 
Russia  itself.  The  second  and  most  im- 
portant cause  was,  however,  the  circum- 
stance that,  notwithstanding  the  sur- 
passing natural  quality  of  Russian  wheat, 
inferior  methods  of  cultivation,  lack  of 
a  satisfactory  choice  of  seeds  and  poor 
cleaning  and  sifting  of  the  grain  created 
difficulties  for  Russian  wheat  in  the 
competitive  world  markets.* 

Diagrams  Nos.  29  and  30  show  how 
rapidly  Argentine  and  Canada  left  Rus- 
sia behind  them  in  this  field.  From  these 
diagrams  it  may  be  seen  that,  whereas 
during  the  years  1881-1890  the  Argen- 
tine exports  amounted  to  hardly  5%  of 
Russia's  wheat  exports,  from  1911  to 
1913  Argentine  exported  almost  80%  of 
the  volume  of  Russia's  wheat  exports. 
Canada's  share  in  the  exports  of  wheat 
was  unimportant,  not  only  in  the  '80's 
and  '90's  of  the  last  century,  but  also  in 
the  first  decade  of  the  twentieth  cen- 
tury, during  which  time  Canada  just 
succeeded  in  surpassing  J4  of  Russia's 
total  of  wheat  and  flour  exports.  But 
in  the  last  three  years  before  the 
War,    under    the    tremendous    impetus 


♦See  my  investigation  on  this  subject  entitled: 
"Inquiry  Concerning  the  Causes  of  the  Decline  in  the 
Importation  of  Russian  Wheat  to  England,"  Petro- 
grad,   1903. 


of  the  opening  of  many  thousands 
of  miles  of  new  railroad  lines,  the 
Canadian  wheat  exports  grew  enor- 
mously, so  that  just  before  the  War, 
Canada  had  already  exceeded  Russia's 


Average    Y/e/c/     of' 
Wheaf   per    Cap/ia 
(1901  -/9//) 
50-,  4s 


40  H 

(0 

O  30- 
o 

a 

20  H 


10- 


40 


26 


18 


/3 


7 


en 

D 


in 

UJ 

t 

in 

Q 
liJ 

h- 


< 

2 
< 

i: 

D 
O 

a 


< 

I- 
in 

D 
< 


< 

< 
Z 
< 


< 

z 

h 
z 
lij 

a. 
< 


Diagram  No.  28 


32 


RUSSIA  -  HER  ECONOMIC  PAST  AND  FUTURE 


wheat  exports. J  Owing  to  the  competi- 
tion of  these  countries,  with  highly  de- 
veloped methods  of  production,  Russia 


tin  the  year  1915-1916  the  exports  of  wheat  from 
Canada  reached  such  dimensions,  that  they  consider- 
ably exceeded  the  maximum  attained  by  Russia  at  any 

period. 


lost  almost  completely  the  biggest  grain 
market  in  the  world,  the  United  King- 
dom, as  shown  by  diagram  No.  31. 
Studying  this  diagram  we  See  that 
whereas  from  1881  to  1890  Russia  sup- 
plied almost  64%  of  the  entire  importa- 


Whe<pff    Exports    from     Russia   (pin(pl  Arc^entlna 
(In    Millions   of    "Pooc^s") 


ZOO 

180 

160  H 

140 

120 

100  - 
60- 
60- 
40- 
20 
0-" 


]  RUSSIA 


ARGENTINA 


Arc^en  fina  Exporis/- 

in  Perce nf 
of  Exporfs  from^ 
Russian 


r \ 

I     I 

/  t 


80 


70 


-  60 


50 


40 


o 


0/ 

30  a 


20 


o 


00 


o 


CO 


o 


hO 


<y> 


0 


Diagram  No.  29 


RUSSIA  ~  HER  ECONOMIC  PAST  AND  FUTURE 


33 


tion  of  wheat  into  the  United  Kingdom 
from  Russia,  Canada,  Australia  and  Ar- 
gentine, combined,  her  share  fell  down  to 
\7'/o  during  the  three  years  that  pre- 
ceded the  War,  whereas  the  proportion 
of  Canada,  Australia  and  Argentine 
grew  to  83%.§ 

To  this  same  backwardness  of  meth- 
ods of  production  must  be  attributed 
the  fact  that,  while  in  the  closing  years 
of  the  19th  century  Russia  exported  a 
considerable  amount  of  corn,  flaxseed 
and  oats  (see  diagrams  Nos.  32,  33  and 
34),  during  the  last  year  before  the  War, 
Argentine's  export  of  corn  was  about 
9  times,  and  its  export  of  flax-seed  about 
12  times  larger  than  that  of  Russia. 
Rut  the  most  interesting  comparison  is 
that  of  the  exports  of  oats  from  these 
countries.  While,  during  the  first  five- 
year  period  of  the  XXth  century,  the 
exports  of  oats  from  Argentine  were  ab- 
solutely negligible  (less  than  2%  of  Rus- 
sia's), in  the  years  just  preceding  the 
War,  Argentine's  exports  of  oats  were 
larger  than  those  of  Russia.  All  these 
facts    sufficiently    prove    the    necessity 


§During  the  year  just  before  the  War,  Russia's  share 
was  even  less  than  the  figures  given  above.  It  amounted 
to  only  8%.  whereas  Canada,  alone,  e.xported  to  the 
United  Kingdom,  during  this  year,  about  5'/2  time.s 
more  than  Russia,  although  Russia's  crop  for  1913  was 
e.xcellent. 


Exporfs    o-r    Wheoii-   -Trom 
Canac^cr ,   in    Perceni-a<^e     of 
Russia's      Wlieci+     Exporis 

125% 


100% 


7  5% 


50% 


25% 


00        (51        O         — 
oO        cO        <Si         CJ1 


Diagram  No.  30 


W/ieat  Imports  info  fine    Unii-ec/  Kinqdom  from   Russic^,  Arqenfina, 

Ausfroili(Pf  (Pfn(^    C(P!ncfC^c^ 
(In  Millions     of    Cwfs.) 


Diagram  No.  31 


34 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


Diagram  No.  32 


of  the  great  efforts  Russia  must  make 
to  improve  her  agricultural  outfit,  her 
live  stock,  her  selection  of  seeds,  the 
application  of  artificial  fertilizers  and 
the  building  of  grain  elevators.  How 
backward  Russia  is  in  this  last  respect 
may  be  shown  by  the  fact  that  while  the 
total  capacity  of  Canada's  grain  eleva- 
tors reached  194  million  bushels  in  1916- 


tThis  includes  the  capacity  of  elevators  constructed 
by  the  Russian  State  Bank.  Unfortunately,  the  old 
Government  constantly  postponed  the  construction  of  a 
system  of  State-owned  grain  elevators,  as  well  as  hin- 
dered the  construction  of  privately-owned  terminals, 
fearing  that  these  latter  would  unfavorably  influence 
the  prices  of  grain  obtained  by  the  great  land  owners. 
As  a  result,  Russia  remained  without  either  a  State  or 
a  private  system  of  elevators. 


1917,  the  elevators  of  Russia  could  hold 
no  more  than  30  million  bushels  at  that 
time.f  When  the  railway  mileage  and 
the  average  yields  of  the  grain  harvests 
of  these  countries  are  taken  into  account, 
the  difference  in  favor  of  Canada  (see 
diagram  No.  35)  is  still  more  pro- 
nounced. 

To  afford  Russia  an  opportunity  for  a 
fair  competition  in  the  World  Market, 
it  will  be  necessary  to  construct,  during 
the  next  ten  years,  a  system  of  grain  ele- 
vators, including-  10,000  with  a  capacity 
of  10,000  to  25,000  bushels,  and  some 
dozens  of  larger  terminals.     Under  the 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


35 


present  high  cost  of  labor  and  materials, 
the  construction  of  such  a  system  of 
grain  elevators,  including  the  necessary 
expenditures  for  sidings,  etc.,  etc.,  would 
amount  to  at  least  $400,000,000. 

To  the  small  dimensions  of  the  Rus- 
sian export  trade  and  also  to  the  in- 
efficient policies  of  the  old  regime  must 


*While  other  countries  have  been  constantly  increas- 
ing the  size  of  the  vessels  of  their  Merchant  Marine, 
constructing  or  buying  vessels  of  over  10,000  tons, 
Russia,  before  the  War,  had  no  vessel  of  this  tonnage. 
This  was,  in  part,  due  to  the  fact  that  the  great  majority 
of  Russian  ports,  because  of  their  insufficient  depth, 
as  well  as  the  insufficient  depth  of  their  sea-channels 
were  unable  to  accommodate  vessels  of  this  size. 
The  same  unfavorable  situation  existed  with  refer- 
ence to  the  speed  of  the  majority  of  ships  in  the 
Russian  Merchant  Marine. 


be  attributed  the  fact  that  Russia's 
merchant  marine  occupied,  as  seen  from 
diagram  No.  36,  one  of  the  last  places 
among  the  marines  of  the  cultured  na- 
tions. Even  such  small  countries  as  Nor- 
way, Sweden  and  Holland  had  larger 
commercial  fleets  than  such  a  great 
power  as  Russia.  If  the  quality  and 
size  of  the  vessels  of  her  merchant  ma- 
rine are  further  taken  into  account,  Rus- 
sia's position  in  this  respect  was  one  of 
the  most  insignificant  in  the  world.*  One 
of  the  most  important  causes  of  the  un- 
developed condition  of  the  Russian  mer 
chant  marine  was  the  lack  of  direct  lines 


f/axseec^   Exports    from      Russia    (?inc^   Arqenfina 
(in    Millions     of  "Pooo/s) 


^  RUSSIA 


lAVA 


Diagram  No.  33 


36 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FLTURE 


between  the  main  ports  of  Russia  and 
other  countries. 

In  view  of  the  above  stated  facts 
there  is  little  wonder  that  Russia's  ex- 
ports were  incredibly  low.  Upon  exam- 
ination of  diagram  No.  37,  we  find,  in- 
deed, that  the  figures  for  Russian  ex- 
ports per  capita  of  population  occupy 
one  of  the  very  last  places.  By  compar- 
ing them  (diagram  No.  38)  with  those  of 
countries  which  have  only  recently  en- 
tered the  world  market,  we  observe  that 
the  growth  of  exports  from  these  coun- 
tries exceeds  many  times  the  exports  of 
Russia.  Thus,  for  instance,  the  exports 
of  the  above  mentioned  countries  for  the 


period  of  191 1-1913  were,  per  capita:  In 
Canada,  10  times  larger  than  in  Russia; 
in  Argentine,  12  times  larger  than  in 
Russia;  in  Australia,  18  times  larger 
than    in    Russia. 

The  facts  are  extremely  interesting 
in  that  they  clearly  show  what  a  splen- 
did future  is  awaiting  Russian  foreign 
trade,  if  the  technique  of  industry  and 
agriculture  should  be  improved  in  ac- 
cordance with  the  requirements  of  a 
modern  country.  If  Russia's  per  capita 
exports  are  to  attain  to  the  size  of 
those  of  Canada  25  years  ago,  the  total 
of  the  Russian  exports  must  be  increased 
four  times. 


Ocrhs  Exports   from   Russia  c^nc^  Arcjenfina 
(In  Millions    or"Poocp/s") 


80-1 
70- 

60 
50 
40 
30- 
20- 
10 
0 


]    RUSSIA 
ARGENTINA 


1901- 
1905 


I90e 


1907 


1906 


Diagram  No.  34 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


37 


Orel  in      Elevc- 

>^ors       in      Russia     anc/     Ccfnac^a 

(in   len)                     1 

1          1  CANADA 
lllll  RUSSIA 

To-hcfi  Storct^e 
Capacity  of  Gram 
£fevc*f-ors 

Stora^ 
Ele^al- 
l-he  To 
Wheal 

2i 

e  Capacity 
ors   in  Perc 
t-at  Averaq 
,  Rye.  OaH 
Corn 

of  Grain 
'nH»ge  of 
e  Yig/alof 

,  Barley  anti 

n24% 

Sfarage  Capaci/y  of 
.Oram    Elevators 
per  Mile  of  Railroad 
lines    in  OperaHon 

pfeOOO 

200  n 

194 

-  2Q% 

500 

7 

■-  5000 

w  1  60  ■ 

-  1  8% 

^  160  ■ 

16% 

- 40dO_ 

0  140 

CO 

-  14% 

1/ 

^120- 

-  1  2% 

-  5000^ 

°  100- 

-  1  0% 

U) 

t   so- 

%    60- 

-    >i% 

-  2000  ^ 

z.    40- 
f     20- 

M 

0  5 

-  4% 

-  2% 

uOO 

-    1000 

««l 

1 

In  this  connection  it  is  interest- 
ing to  notice  that  by  far  the  great- 
est part  of  all  imports  and  exports 
were  carried  to  Russia  and  from 
Russia  by  ships  sailing  under  a 
foreign  ilag.  In  the  year  1913, 
for  example,  the  tonnage  of  all 
ships  coming  from  foreign  ports 
under  foreign  flag  equalled  13,166,- 
000  registered  tons,  while  the  im- 
ports coming  from  foreign  ports 
under  the  Russian  flag  equalled 
only  3,312,000  tons,  i.  e.,  21^0  of 
the  total. 


Diagram  No.  3S 


5000- 


4000 


3000- 


2000 


1000- 


Tonnerqe    of  Merchc^nf   Mc^rine  Stecpimers  of  the   most 
imporl-cfni-  Countries  (in    1000   Tons    Net) 


ENGLAND  GERMANY     USor      JAPAN     BRITISH    NORWAY    FRANCE     SPAIN        ITALY     SWEDEN    AUSTRIA- HOLLAND  RUSSIA    DENMARK 
AMERICA  COLONIES  HUN5ARY 


With  exception  of  the  United  States,  Japan  eine^  Spain  for  which  Countries  the  Tonnat^e  is  i^/ven  in  Cross  Tons 

Diagram  No.  36 


38 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


800- 

700- 

600- 

500- 

400 

300- 

200 

100- 


600 


Exports  per    Ccpipifci  (In  German     Marks) 
1910  -   1912 


537 


IL 


3// 


2/6 


''.04 


115 


129 

125 

68 


Ct 

z 
< 

_l 
-I 
o 

r 


E 

_J 

D 

< 

Oi 

vD 

1- 

_l 

U) 

UJ 

D 

(0 

< 

< 

z 


a 
< 


a 

z 
< 

_i 

Z 


i2 


< 

< 

Z 
< 


UJ 

z 

iS 

o 

< 

if> 

z 

r 

o 

<■ 

a 

1- 

ct 

UJ 

z 

U- 

o 

3 

_J 

< 


—  a 
pc< 

wz 

<I 


Diagram  No.  37 


1-^1 1 —   1 

< 

Z 

IS) 

< 

<r» 

D. 

D 

< 

a 

-) 

Exporfs  per  Capif(^  {in     Roubles) 


1686-90 1906-10 1911-11 
RUSSIA 


>-90  1906-10 1911-15    1886-901906-101911-13    1886-901906-10 1911-1 J 

CANADA  ARGENTINA  AUSTRALIA 


pi  GO 

-140 
120 
100 

V  80 
60 

-  40 

20 
0 


Diagram  No.  38 


CHAPTER  IV. 


Canals  and   Inland  Waters — Comparison  with  Other 
Countries — Proposed  New  Canal  and  River  Im- 
provements— Expenditures  for  Construction. 


T 


HE  llrsl  canals  in  Russia  were  be- 
gun by  Peter  the  Great  (Ladoga 
Canal).  Although  the  total  length 
of  all  the  inland  waters  in  Russia  now 
reaches  about  200,000  miles,  the  length 
of  all  Russian  canals  and  improved  rivers 
reaches  barely  1100  miles,  of  which  last 
figure  the  canals  themselves  make  up  only 
about  550  miles.  Russia  has,  in  all,  eight 
so-called  inland  water-systems.  Three  of 
these,  the  Mariinskaya,  the  Tikhvinskaya 
and  the  Vishni-V^olotskaya,  connect  the 
Caspian  and  the  Baltic  Seas  by  means  of 
the  Volga  and  the  Neva.  The  Canal  of 
Duke  Alexander  of  Wurttemberg  con- 
nects the  North  Dvina  with  the  Mariin- 
skaya System,  that  is  to  say,  the  White 
Sea  with  the  Caspian  and  Baltic  Seas. 
The  Dnieper-Bug  system,  the  Oginsky 
Canal  and  the  Berezina  system  connect 
the  Black  Sea  with  the  Baltic.  The  Dnie- 
per-Bug system  connects  these  seas  by 
means  of  the  Vistula,  the  Oginsky  Canal 
by  means  of  the  Nieman,  and  the  Bere- 
zina system  by  means  of  the  Western 
Dvina.  The  Augustovskaya  system  con- 


*The  connection  between  the  Ob  and  the  Yenissei 
consists  of  the  tributary  of  the  Ob,  the  Ket.  for  a 
length  of  235  miles,  and  the  rivers  Ozernaya,  Lonio- 
vataya,  Yazevaya  and  the  Great  Lake,  which  all  belong 
to  the  basin  of  the  Ob.  From  this  point  the  canal 
begins,  followed  by  the  rivers,  the  Little  and  the  Great 
Kas,  belonging  to  the  basin  of  the  Yenissei.  The 
Ob-Yenissei  Canal  was  constructed  very  poorly.  It 
permits  the  passage  of  ships  with  a  maximum  length  of 
70  feet  and  a  draught  of  not  more  than  3'/2  feet.  But  on 
the  Yenissei  and  Ob,  many  ships  from  140  to  280  feet 
in  length,  and  with  a  draught  of  considerably  over 
3'A  feet,  are  now  in  use.  .Such  ships,  whose  number  is 
constantly  increasing,  cannot,  consequently,  pass  through 
the  Ob-Yenissei  Canal. 


nects  the  Vistula  with  the  Niemen.  In 
addition,  a  very  small  canal,  of  some 
five  miles,  connects  the  Ob  and  the 
Yenissei.* 

Since  1860,  almost  nothing  has  been 
done  in  Russia  for  the  improvement  of 
the  canals,  for  the  Government  feared 
that  the  canals  and  rivers  would  become 
dangerous  competitors  of  the  railways, 
and  thus  reduce  their  profits.  In  view 
of  this,  the  Government  did  not  care  to 
grant  any  serious  aid  for  the  improve- 
ment of  Russia's  inland  waterways. 
What  aid  the  Government  did  give  was 
quite  insufficient  even  to  keep  such 
canals,  as  already  existed,  in  good  work- 
ing condition.  In  view  of  this,  not  only 
were  the  waterways  not  improved,  but 
often  indeed  fell  into  disrepair.  Some 
canals,  for  example,  the  Kama-Vichegda 
waterway  (Ekaterininsky  Canal)  fell 
absolutely  into  ruin,  and  the  equipment 
was  almost  destroyed. 

To  show  how  little  the  old  regime 
understood  the  significance  of  the  fact 
that  Russia  had  first  place  in  the  world 
so  far  as  waterways  were  concerned, 
and  could  therefore  use  the  richness  of 
this  natural  endowment  for  the  develop- 
ment of  her  resources,  may  be  seen  from 
the  fact  that,  from  1909  to  1917,  on  the 
whole  system  of  internal  waterways  the 
Government  spent,  in  all,  $28,000,000, 
that  is,  about  $4,000,000  annually.  For 
immense  Siberia,  with  its  innumerable 


40 


RUSSIA— HER  ECONOMIC  PAST  AND  FUTURE 


watcr\v;i\s,  for  these  eight  years,  only 
$250,000  i)ci-  year  was  spent. 

How  insignificant  were  the  sums 
spent  for  this  purpose  in  Russia,  com- 
pared with  the  expenses  for  the  same 
])urpose  in  other  countries,  may  be  seen 
from  diagrams  Nos.  39  and  40,  in  the  first 
of  which  is  shown,  by  per  cents,  the  pro- 
portion of  canals  and  improved  rivers  to 
the  total  length  of  all  navigable  inland 
waters,  and  in  the  second  the  expenses  per 
mile  of  navigable  waterways  in  dififerent 
European  countries  and  Russia.  By 
spending  the  moderate  sum  of  $350,000,- 
000  the  length  of  navigable  inland  water- 
ways in  Russia  could  easily  be  doubled, 
bringing  the  pre-war  length  of  Russian 
waterways  to  70,000  miles.  Fearing,  as 
has  been  said,  the  lowering  of  the  income 


from  the  railways,  the  Russian  Govern- 
ment spent  from  1909  to  1917  only  about 
$100  per  mile,  taking  into  consideration 
navigable  rivers,  or  about  $16  per  mile  if 
we  consider  the  total  length  of  Russian 
waterw^ays.  France  spent  about  $1250 
and  Germany  still  more,  about  $1750. 

As  far  as  separate  rivers  are  con- 
cerned, the  expenditure  of  Russia  was 
still  more  insignificant.  It  is  sufificient 
to  refer  to  diagram  No.  40,  which 
shows  that  when  Russia  spent  $150 
per  mile  on  the  river  Don,  one  of  her 
most  important  rivers,  flowing  through 
coal  and  mining  regions,  Germany  ex- 
pended on  the  Rhine  $20,400,  and  France 
on  the  Rhone,  about  $24,000  per  mile. 

How  backward  Russia  was  in  respect 
to  the  improvements  of  inland  water- 


100-] 

r40 

' 

^36 

90 

Canals  oino/    improved    Rivers 

Expenses  for  the 

Impro  vemen  fs 

-32 

60 

in     Percen+cPige  of  the  To  fa! 

of  the     Inland    Waters 

Na  viewable    Inicpinol  Wafers 

(In    1000    Dollars 

'   per    Mile) 

r30 

^10- 

-26 

^60- 

24 
1— n 

■26 
■24 

OJ 

55 

20.4 

22 

o50^ 

20 

i_ 

IG.i 

■16 

a.40- 

n  ^' 

^^"" 

■16 

15.1 

-14 

"^30- 

. 

•12 

24 

■10 

20- 

16 

-  8 

-  6 

10  • 

7.2 

-  4 

0 

n 

5.6 

'A^m 

■   2 

0 

a 

-AND 

LAND 

NCE 

MANY 

GIUM 

ED  STAT 

TRIA- 
GARY 

< 

z          UJ         q:         z 

<         a 

_j          O          <          a          -J           t:        if)^ 

10 

=             (fl            UJ            o 

3      y       z 

o          Z          q:          liJ          UJ           z        33 

3 

r          _i         Q          r 

o         z          o 

X              LU              U-              ^O              CO               D<I 

cc 

a:          LU         o         q: 

>               Q                Q 

Diagram  No.  ,39 


Diagram  No.  40 


RUSSIA —HER  ECONOMIC  PAST  AND  FUTURE 


41 


ways  is  evident  from  diagram  No.  39. 
Upon  examination  of  the  figures  we 
find  that  out  of  about  32,000  miles  of 
navigable  waterways,  there  are  now 
improved  or  supplied  with  canals  less 
than  4%  of  the  total,  while  in  Germany 
at  the  very  beginning  of  the  20th  cen- 
tury improvements  were  made  on  40%, 
— in  England  on  about  53%,  and  in 
Holland  to  as  great  an  extent  as  70% 
of  the  total  length  of  inland  water- 
ways. 

The  figures  given  in  diagram  No.  40, 
which  we  have  referred  to  just  previous- 
ly, concerning  the  expenditure  of  Russia 
and  other  countries  for  river  and  canal 
improvements,  is  sufficient  proof  of  the 
necessity  of  immense  outlays  for  the 
improvement  of  Russia's  inland  water- 
ways. 

Only  in  recent  years  has  the  Russian 
Government  understood  the  immense 
importance  of  such  inland  ways  of  com- 
munication, and  in  1917  the  Ministry 
of  Ways  and  Communications  elab- 
orated a  plan  for  the  construction  of 
new  waterways  and  the  reconstruction 
of  the  old  systems. 

The  whole  program  of  the  Govern- 
ment was  conceived  for  a  period  of 
operation  of  twelve  years.  In  the  first 
seven  years,  from  1917-1924,  it  was  in- 
tended to  spend  the  sum  of  $1,000,000,- 
000  and  for  the  period  from  1924-1929, 
$1,000,000,000  more.  Taking  into  con- 
sideration the  high  cost  of  material  and 
labor  at  the  present  time,  the  expendi- 
ture necessary  to  accomplish  this  plan, 
in  the  next  decade,  would  amount  to 
$4,000,000,000. 

The  accomplishment  of  this  plan 
would  bring  about  the  following  re- 
sults: First,  it  would  connect,  by  means 


of  canals,  all  the  most  important  water- 
systems  of  Russia;  second,  it  would 
permit  a  radical  improvement  of  the 
old  waterways  and  create  a  group  of 
new  waterways  for  the  movement  of 
heavy  and  bulky  freight ;  third,  it  would 
permit  the  use  of  rivers  and  water- 
falls for  the  development  of  a  system  of 
electric  central  power-stations;  fourth, 
it  would  allow,  by  the  betterment  of 
the  ways  of  communication  in  many 
districts,  their  colonization  or  the  devel- 
opment of  various  industries;  finally,  it 
would  open  new  exits  to  the  seaports 
for  bulky  freight  of  low  intrinsic  value, 
which  cannot  be  transported  by  rail, 
because  of  the  much  higher  freight 
rates  of  the  railroads.  This  new  gov- 
ernmental plan  was  intended  to  deepen 
the  inland  waterways,  and  to  furnish 
such  locks  that  it  would  be  possible  for 
ships  of  2000  to  3000  tons  displacement 
to  pass  through. 

It  is  particularly  noticeable  that  the 
new  plan  has  given  serious  considera- 
tion to  the  interests  of  Siberia.  For 
example,  it  was  intended  to  install 
locks  on  the  Tom  River,  from  Kuznetsk 
to  Tomsk.  This  undertaking  would 
create  a  navigable  waterway  of  some 
340  miles  in  length,  with  a  total  fall  of 
450  feet.  In  addition,  it  was  intended 
to  furnish  locks  for  the  lower  portion 
of  the  Tobol  River,  as  far  up  as  the 
point  of  junction  of  the  Tura,  and  of  the 
river  Tura  up  to  the  important  city  of 
Tumen;  this  new  waterway  would  ex- 
tend for  260  miles,  with  a  total  fall  of  50 
feet.  With  the  help  of  these  canals  and 
locks  there  would  be  created  a  continu- 
ous waterway  from  one  of  the  most  im- 
portant coal  regions  of  Russia,  that  of 
Kuznetsk,  to  the  large  industrial  plants  in 


42 


RUSSIA— HER  ECONOMIC  PAST  AND  FUTURE 


the  Ural  mountain  region. 

This  water-way,  in  addition  to  trans- 
porting coal  and  ore  for  Russian  in- 
dustrial plants,  would  also  ojien  an  exit 
to  the  world  market  for  grains,  furs, 
hides,  asbestos,  timber,  and  other  prod- 
acts  of  Western  Siberia.  Finally,  the  cre- 
ation of  a  suitable  canal  between  the 
Ob  and  the  Yenissei,  by  furnishing  the 
rivers  Ket  and  Kas  with  locks,  would 
give  a  cheap  exit  to  the  world  market 
for  the  immensely  rich  regions  of  Cen- 
tral Siberia,  as  the  above  mentioned 
canals  and  locks  would  connect  the  two 
most  important  river  systems  of  the 
world,  creating  an  excellent  water-way 
for  a  length  of  about  12,000  miles.* 

Furthermore,  according  to  the  above 
mentioned  plan,  it  was  intended  to 
spend  large  sums  for  supplying  the 
water-systems  with  a  sufficient  number 
of  dredging  machines,  for  building  new, 
and  improving  old  piers,  for  furnishing 
them  with  the  necessary  equipment  for 
loading  and  unloading  freight,  for  cre- 
ating sheltered  harbors  for  the  winter 
season,  for  improving  the  entrances  to 
harbors,  for  establishing  facilities  for 
repairing,  etc.,  etc. 


*The  water-way  from  Omsk  to  Tumen  has  a  length 
of  1,025  miles  and  that  of  Tomsk  to  Tumen,  1,560  miles. 

If  the  Tura  and  the  Tobol  should  be  sufficiently 
deepened,  Tomsk  and  Omsk  would  become,  possibly, 
more  important  river  ports  than  Samara  and  Saratov 
are  now. 

From  Lake  Tarinor  to  its  mouth,  the  Yenissei  has  a 
length  of  2,370  miles,  of  which  about  2,000  is  in  Russian 
territory.  Of  the  tributaries  of  the  Yenissei.  the 
Angara  has  a  length  of  about  1,200  miles,  the  Pod- 
kamennaya  Tunguzka  1,030  miles,  the  Nijnyaya  Tun- 
guzka  over  1,800  miles.  Of  the  most  important  tribu- 
taries of  the  Angara,  the  Irkut  has  a  length  of  370 
miles,  the  Kitoi  170  miles,  the  Oka  550  miles,  the  Tchuna 
700  miles,  the  Birusa  475  miles  and  the  Ilim  280  miles 

The  length  of  the  Ob  river,  from  the  junction  of 
the  Bia  and  the  Katun  to  its  mouth,  is  2,325  miles. 
The  most  important  tributaries  of  the  Ob  are  the 
Irtish  (length  in  Russian  territory  2,360  miles),  the 
Tom  (550  miles),  the  Tchulim  (1,185  miles),  tlie 
Tcharish  and  the  Alei.  The  most  important  tribu- 
taries of  the  Irtish  are  the  Om  (480  miles),  the  Tara 
(215  miles),  the  Ishim  (1,430  miles),  the  Tobol  (1,000 
miles). 


in  general,  for  the  needs  of  Siberia,  the 
plan  provided  for  spending  $160,000,000, 
for  the  period  from  1918  to  1924.  Ac- 
cording to  the  present  cost  of  materials 
and  labor,  the  cost  of  the  above  construc- 
tion would  be  about  doubled. 

As  far  as  the  use  of  the  river 
currents  and  water-falls  for  the  de- 
velopment of  electric  power  is  con- 
cerned, it  is  sufficient  to  state  that  the 
Dnieper  rapids  alone  could  produce,  as 
specialists  have  stated,  from  600,000  to 
1,000,000  horse-power.  In  the  north- 
western part  of  European  Russia,  the 
Svir  could  furnish  about  200,000  horse- 
power, the  Narova  about  70,000  and  the 
Volkhov  about  60,000. 

Immense  quantities  of  water-power 
could  furthermore  be  developed  in  the 
Caucasus.  The  existing  sources  for  the 
production  of  electrical  energy  are  the 
rivers  Kuban,  Kura,  Araks  and  their 
tributaries,  as  well  as  a  large  number 
of  other  mountain  streams  which  could 
together  produce  many  hundred  thou- 
sands of  horse-power.  The  same  may 
be  said  concerning  the  rivers  of  the 
Ural  region,  namely,  the  Kama,  Chuso- 
vaya, the  Belaya,  etc.,  and  to  a  still  great- 
er extent  of  the  Siberian  rivers.  In  ad- 
dition to  the  chief  Siberian  rivers, 
the  Ob,  the  Yenissei,t  the  Lena,$  the 


fTlie  .'\ngara  alone  pours  into  the  Yenissei  over 
6,000  cubic  yards  of  water  per  second, — that  is,  more 
than  the  largest  river  of  European  Russia,  the  Volga, 
together  with  the  Kama,  its  tributary,  have,  at  their 
junction.  The  Yenissei,  at  its  point  of  junction  with 
the  Angara,  has  a  volume  of  about  12,500  cubic  yards 
of  water  per  second. 

JThe  Lena  is  the  greatest  river  in  Asiatic  Russia, 
having  a  length  of  2,800  miles.  It  has  the  following 
tributaries : 

The  Ilga,    with    a    length   of   90   miles 
"    Kuta,      "     "        "         "    200     " 

'•    Kirenga "    400     " 

"  Vitim  "  "  "  "1,200  " 
"  Olekma  "  "  "  "  800  " 
"  Aldan  •'  "  "  "1,850  " 
"    Vilui       '1,550     " 


RUSSIA  -  ^  HER  ECONOMIC  PAST  AND  FUTURE 


43 


Syr-l)aria,§  the  Anui-Daria§§  and  the 
Ainour,*  there  would  also  be  obtainable 
some  millions  of  horse-power  from  the 
rapids  of  the  Angara,  the  Ussiiri,  the 
Tobol,  the  Tura,  the  Tom,  the  Irtish, 
the  Tutickc,  the  Iman,  the  Suifun,  and 
hundreds  of  other  rivers  which  flow 
near  the  large  cities,  or  through  regions 
possessing  large  deposits  of  coal  and 
other  minerals. 

To  sum  up,  without  works  which 
would  require  excessive  expenditures, 
the  water  sources  of  Russia  could  de- 
velop in  the  next  ten  years  about  5,000,- 
000  to  6,000,000  horse-power.  About 
the  same  total  of  horse-power  could  be 
obtained  by  using  the  enormous  deposits 
of  peat  and  low-grade  coal.    Taking  into 


§The  Syr-Daria  river  is  formed  by  the  junction  of 
the  Narin  and  the  Kara-Daria.  From  the  sources  of  the 
Narin  to  the  mouth  of  the  Syr-Daria,  the  stretch  of 
water  is  1,580  miles,  and  from  the  junction  to  the 
mouth  it  is  1.130  miles. 

§§The  Amu-Daria  river  is  formed  by  the  junction  of 
the  \'akhan-Daria  and  the  Pamir.  The  width  of  the 
Amu-Daria,  in  its  middle  section,  is  about  5^  of  a 
mile,  on  the  average,  but  in  many  places,  it  is  2  or 
2}i  miles  wide. 

The  current  attains  a  speed,  in  narrow  portions  of 
the  river,  of  more  than  seven  miles  and,  at  times,  of 
ten  miles,  an  hour.  This  river  has  a  developed  navi- 
gation. 

♦The  Shilka  and  .^rgun  combine  to  form  the  Amour, 
which  has  a  length,  from  the  junction  of  these  rivers 
to  its  mouth,  of  about  1,800  miles.  The  Amour  is 
navigable  throughout  its  entire  length.  Its  most  im- 
portant tributaries  are  the  Shilka,  formed  by  the  union 
of  the  Onon  and  the  Ingoda,  with  a  length  of  370  miles, 
from  the  point  of  junction,  the  Argun,  having,  in 
Russian  territory,  an  extent  of  600  miles,  the  Zeia 
(770  miles),  the  Bureia  (430  miles),  the  Amgun  (580 
miles).  The  tributary  of  the  Shilka,  the  Nercha,  has 
a  length  of  325  miles. 


consideration  the  fact  that  the  con- 
struction of  electrical  power  stations 
would  demand  an  average  expenditure, 
including  dynamos,  cables,  etc.,  of  about 
$100  to  $120  per  developed  horse-power, 
the  total  outlay  for  constructing  a  sys- 
tem of  central  electrical  power  stations, 
built  to  use  the  streams  as  well  as  the 
peat  and  low-grade  coal,  would  be,  for 
the  next  ten  years,  about  $1,500,000,000 
to  $2,000,000,000.  This  would  include 
the  capital  which  would  have  to  be  in- 
vested in  peat  or  low-grade  coal  mining 
operations,  but  not  the  capital  for  high- 
grade  coal  mining. 

In  the  matter  of  coal  production,  it  is 
necessary  to  state  that  the  per  capita 
production  in  Russia  was  before  the 
War  one  of  the  smallest  in  the  world,  as 
may  be  seen  from  the  following  data: 


Russia 

Austria-Hungary 

France 

Belgium 

Germany 

United  States 

United  Kingdom 


about  0.2  me 
1.0 
1.0 
3.0 
3.8 
5.1 
6.0 


ric  tons 


To  raise  the  per  capita  production 
of  coal  in  Russia  to  that  of  Austria- 
Hungary  means  that  the  production  of 
coal  must  be  enlarged,  at  least,  from  5  to 
6  times.  This  increase  in  production 
would  cost,  at  least,  $800,000,000. 


CHAPTER  V. 


Ports — Their  Trade — Comparison  with 
Other  Countries — Expenditures  for  Improvements 


ANOTHER  question,  for  the  solu- 
tion of  which  Russia  must  make 
large  expenditures,  is  the  improve- 
ment of  her  ports.  How  quickly  other 
lands,  in  this  respect,  have  surpassed 
Russia,  may  be  seen  from  the  fact  that 
among  some  hundred  and  thirty  large 
ports  (concerning  which  we  have  data 
relating  to  the  total  tonnage  of  the  ships 
entering  them)  the  most  important 
Russian  port  in  the  Black  Sea,  Odessa, 
ranked  as  follows : 

In  1900  about  34th  in  rank 
"  1906       "      37th  "     " 
"  1908       "     47th  "     " 
"  1910       "      52nd"     " 
"  1912       "      67th  "     " 
Now,  after  the  War,  in  view  of  the 
large   expenditures   made   for   ports   in 
other    countries,    Odessa    would    rank 
lower,  probably  as  low  as  75th  or  80th. 
Taking    into    consideration,    not    the 
total  tonnage  of  ships  entering  the  port, 
but  the  tonnage  coming  there  from  for- 
eign waters,  the  rank  of  Odessa  would 
be   still    lower,   as   may   be   seen    from 
the  following  data: 

In  1900  about     50th  in  rank 
"  1910       "        94th  "     " 
"  1912       "      117th  "     " 

After  the  War,  if  the  government 
does  not  take  measures  for  the  improve- 
ment and  enlargement  of  this  port,  such 
as  installing  better  freight  facilities, 
large  docks  and  warehouses,  deepening 
the  harbor  and  channels,  and  extending 


the  railway  connections,  Odessa  will 
probably  fall  to  the  lowest  rank  among 
the  most  important  ports  of  the  world. 
The  same  may  be  said  of  the  most  im- 
portant Baltic  port,  Petrograd,  includ- 
ing Kronstadt.  Its  rank,  among  the 
most  important  ports  of  the  world, 
was : 

As  Regards  As  Regards  Tonnage 

Year.  Total  Tonnage.      From  Foreign  Ports. 


In  1900  about  46th 
"  1910  "  82nd 
"  1912       "     99th 


39th  in  rank 
65th  "      " 
79th  "      " 


The  most  regrettable  circumstance  is 
the  fact  that  Russia  was  surpassed  not 
only  by  countries  of  long  established 
civilization,  such  as  England,  France 
and  Germany,  but  also  by  countries 
which  have  but  recently  become  com- 
petitors in  the  markets  of  the  world. 
This  can  be  very  clearly  seen  from  dia- 
gram No.  41,  which  shows  that  while 
the  tonnage  of  the  ships,  entering  Rus- 
sian ports  from  foreign  waters,  has 
slightly  increased,  the  ports  of  Canada, 
Argentine,  Australia,  India,  Chile,  Japan, 
etc.,  have  vastly  increased  their  tonnage 
in  foreign  trade.  In  this  respect,  it  is 
sufficient  to  state  that  the  tonnage  of 
ships  coming  from  foreign  waters  to 
the  six  most  important  Russian  ports, 
Petrograd  (including  Kronstadt),  Odes- 
sa, Riga,  Nikolaiev,  Taganrog,  Novoro- 
sisk,  increased,  from  1900  to  1912,  from 
5,157,000  to  6,869,000  tons,  that  is,  about 
33%,  while  the  tonnage  of  the  same 
nature    for    the    four    most    important 


46 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


Japanese  ports,  Yokohama,  Kobe,  Moji  port,  Petrograd   (including  Kronstadt). 

and    Nagasaki,    increased,    during    the  Still    further,    one    of    the    Japanese 

same  period,  from  7,957,000  to  17,109,-  ports,  Kobe,  had  about  the  same  ton- 

000  tons,  that  is,  about   105%.     At  the  nage  of  ships  from  foreign   waters   as 

beginning  of  the  War,  the  tonnage  of  five    of    the    most    important    Russian 

ships   coming  from  foreign  waters   to  ports,  taken  together — Petrograd  (with 

the  four  Japanese  ports  just  mentioned  Kronstadt),  Odessa,  Riga,  Nikolaiev  and 

was,  therefore,  about  two  and  one-half  Taganrog.      The    same    unsatisfactory 

times   larger  than   the   tonnage  of  the  comparison    can    be    made    with    other 

same  nature  entering  the  six  most  im-  countries,  especially  with  Canada, 

portant  Russian  ports.     In  addition  to  As  far  as  the  value  of  the  foreign  trade 

this,  it  must  be  stated  that  each  of  the  of  the  most  important  Russian  ports  is 

above-mentioned     Japanese     ports     was  concerned,  the  figures  for  1913  are  as 

ahead  of  the   most   important   Russian  follows: 

Value  of  Value  of 

Ports               Total  Commerce       Imports  Exports         Situated  on 

Petrograd   ....$180,046,000  $110,934,000  $69,112,000  Baltic  Sea 

Riga    174,047,000  69,597,000  104,450,000 

Odessa    78.822,000  33,899,000  44,923,000  Black  " 

Reval 51,332,000  40,265,000  11,067,000  Baltic    " 

Vindua    46,427,000  8,477,000  37,950.000 

Novorosisk  ....  45,823,000  7,473.000  38,350,000  Black  " 

Libau    41,407,000  20,484,000  20,923,000  Baltic  " 

Nikolaiev ■ ' " •  37,049,000  Black  " 

Rostov ■ ■             36,583,000  Azov  " 

Batum 30,051,000  5  446,000  24,605,000  Black  " 

Kherson 21,483,000            "  " 


Tonnage    of   Ships   enfereol    from      Foreiqn     Ports  (in    1000     Tons) 


PAN 


Diagram  No.  41 


RUSSIA       HER  ECONOMIC  PAST  AND  FUTURE 


47 


The  most  important  harbor  of  Siberia 
is  Vladivostok.  In  1913  the  imports 
totaled  $22,549,000,  the  exports  $1,745,- 
000,  and  the  total  value  of  the  foreign 
trade,  $24,294,000. 

The  most  important  ports  on  the 
Murman  Coast  and  the  White  Sea  are 
Murmansk  and  Arkhangel,  but  before 
the  War  their  foreign  trade  was  almost 
negligible. 

The  most  important  products  brought 
into  Russian  ports  before  the  War  from 
foreign  countries  were  coal,  coke,  agri- 
cultural machinery  and  implements,  as 
well  as  many  other  kinds  of  machinery, 
iron  and  steel  manufactured  product.s, 
wool,  cotton  and  silk  goods,  colonial 
products,  raw  cotton  and  wool,  fats, 
etc.,  etc.  The  exports  included  grain 
products  (wheat,  barley,  oats,  corn,  rye, 
linseed,  bran),  oil  cake,  flax,  hemp,  tim- 
ber and  various  forest  products,  butter, 
eggs,  poultry,  raw  hides,  beet  sugar, 
etc.,  etc.  (See  section  on  foreign  trade.) 

How  insignificant  was  the  total  value 
of  the  foreign  trade  of  the  above-men- 


tioned six  most  important  Russian 
ports  may  be  seen  from  the  fact  that 
the  total  of  their  imports  and  exports 
just  about  equaled  the  value  of  the  for- 
eign trade  of  the  French  port,  Mar- 
seilles, reached  about  60%  of  the  for- 
eign trade  of  the  Belgian  port  of  Ant- 
werj),  and  about  40%  of  the  foreign 
trade  of  Hamburg  (Germany)  or  New 
York. 

In  order  to  equip  Russia  with  a  half 
dozen  first  and  second  class  ports  (two 
in  the  Black  Sea,  one  in  the  Sea  of 
Azov,  two  in  the  Baltic,  and  one  in  the 
White  Sea),  having  good  pier  accommo- 
dations, sufficiently  deep  channels  and 
harbors,  adequate  freight  facilities, 
warehouses,  etc.,  etc.,  it  would  be  neces- 
sary to  spend,  at  the  present  high  prices 
of  materials  and  labor,  not  less  than 
$600,000,000;  together  with  the  amount 
necessary  for  the  improvement  of  the 
two  or  three  dozen  other  Russian  ports, 
the  expenditure  would  reach  probably 
$1,000,000,000. 


CHAPTER  VI. 


Railroads —Their  Income — 
essary  Expenditures  for  Co 

ONE  of  the  greatest  shortcomings 
of  the  old  regime,  which,  in  part, 
is  directly  responsible  for  the  pres- 
ent Bolshevist  catastrophe  in  Russia,  was 
its  inefificient  policy  in  the  realm  of  rail- 
way construction.  An  abler  policy  in 
this  direction  would  have  supplied  the 
industrial  forces  of  Russia  with  suffi- 
cient driving  force  to  bring  the  War  to  a 
victorious  termination  at  the  hour  of  the 
advent  of  the  Revolution. 

How  backward  Russia  was  in  this 
respect  may  be  seen  from  diagram  No. 
42,  which  shows  that  the  railroad  mile- 
age of  Russia,  which  has  a  much  larger 
area  than  the  United  States,  was  ap- 
proximately six  times  less  than  the 
mileage  of  the  latter  country.  When 
the  land  areas  of  these  two  countries 


Proposed    New   Lines— Nec- 
nstruction  and  Rolling  Stock 

are  taken  as  the  basis  of  comparison, 
Russia's  mileage  is  actually  about  12 
times  less  than  that  of  the  United 
States.  Nearly  the  same  results  may 
be  obtained  upon  computing  the  mile- 
age of  these  lands  in  comparison  with 
their  respective  populations:  Russia's 
railroads,  on  this  basis,  would  amount 
to  about  one-tenth  of  those  of  the 
United  States. 

During  the  past  several  years  the 
Government  of  Russia  had  begun  to 
realize  that  if  it  continued  to  rely  upon 
its  own  resources  alone,  it  would  not  sat- 
isfy even  the  most  primary  needs  of 
the  country.  In  view  of  this,  the  Gov- 
ernment began  to  grant  to  privately- 
owned  railroads  new  and  very  extensive 
concessions.  This  may  be  observed  with 


RAI LROADS 

|°g°j/?<y55/>l 

300 -, 

1 

\UNITED  STATES                   ^5  q     ^ 

tf)260- 
.-^  260  - 

, 

261 

2.6i 

J 

-2.80i 
-2.60.5 

^240- 

-2.40  ^ 

'%  220- 

-2.20  "2 

u)  200- 

-2.00 'S 

"^  180- 

-1.80'g 

S  160- 

-1.60^ 

gl40- 
^  120- 
c  100- 

- 1.40  g 
-1.20| 
-1.00  ^ 

^60- 

5    40- 
-    20- 

46.0 

-0.80  <u 
-0.60  ^ 
-0.40  i; 
-0.20  f 

0  00 

o  oo 

0  O  0 

o  oo 

U/db 

000 
000 

■^     0  -^ 

L— U 

Diagram  No.  42 


50 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


3000 
2750 
2500 
2250 
2000- 
0)  1750- 
£   1500- 

1250 

f  iOOO 

750-1 

500 

250  H 

0 


Len<^fh    of    Railway      Lines     in      Russia, 
Const  ruciion      of    yv/iicJi      lias     be-en      sfar-ted 


□ 


STATE    RAILWAYS 


°0     Cm 


o 


<M 


PRIVATE  RAILWAY 
CORPORATIONS 


CM 


LO 

o 

CI 

* 


o 

CD 


O 


o 


o 


CI 


Up    to   September    /£''. 


Cm 


Cv) 


CM 

cs^ 


Diagram  No.  43 


10 
(L) 


25 


Pay  men  is  of  the  Russian 
Oovernmen't  to  the  RailrooKpIs 
and  of  fhe  RaUroaals  to  ihe 
Government 


PAID  BY  THE  RAILROAD 
COtlPANlES  TO  THE  STATE 
TREASURY  AS  PAYMENT  OF 
DEBTS  ETC.-y 

^ 


*  Approximate  Data 


Diagram  No.  44 


RUSSIA  -^  HER  ECONOMIC  PAST  AND  FUTURE 


51 


suriiciciu  dcariK'ss  from  diagram  No.  43. 
which  shows  that  from  1906  to  1913 
the  mileage  in  ])rocess  of  construction 
1)\-  jjrivately-ovvned  railroads  was  near- 
ly tliree  times  greater  than  the  mileage 
under  construction  by  the  State. 

The  effort  of  the  private  railroads  to 
increase  their  mileage  on  terms  also 
advantageous  to  the  State  is  explained 
hy  the  fact  that  the  earning  power  of 
Russia's  railroads  rose  greatly  during 
recent  years  (See  diagrams  Nos.  44  and 
45).  The  amount  paid  to  the  Russian 
Treasury  by  these  railroads  grew  from 
3.9  million  roubles  in  1909  to  34  million 
roubles  in  1913.  The  latter  phenome- 
non is  the  result  of  the  unusually  rapid 
growth  of  traffic  on  Russian  railroads, 
as  shown  by  diagram  No.  46.  Experts 
maintain  that  almost  nowhere  in  the 
world  is  the  average  freight  traffic,  per 
mile  of  single  track,  as  high  as  in  Russia. 


Disfribuflon  of  Nef  Profih  of  the 
Russian   Rail  roads 

[In    Millions   of  Roubles)        <si> 


Diagram  No.  45 


R  U  5  S  i  (PI  5 


R  (PI  i  I  w  c?i  y  s 


500-1 


250- 


c 
o 


PASSENGERS 
CARRIED 


Si 


200- 

~ 

150- 

•^ 
^ 

100- 

50- 

<3> 

* 

FREIGHT 
HAULED 


*  Prelimini^ry    Den  fa. 


r6 


in 

r    ° 
W    o 

Q_ 


-4 


O 

in 
c 
o 


■25 

c 

0 


FREIGHT       HAULED      ON 
RAILWAYS       IN      1912 


Diagram  No.  46 


52 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


In  speaking  of  Russia's  backwardness 
in  the  field  of  railway  construction, 
which  is  responsible  for  the  slow  de- 
velopment of  the  whole  country  and  of 
Russian  exports  in  particular,  it  is 
necessary  to  draw  attention  to  the  di- 
rectly opposite  policy  of  Russia's  most 
dangerous  competitor  in  the  world  mar- 
ket in  the  exportation  of  agricultural 
products  —  namely,  Canada.  As  seen 
from  diagram  No.  47,  beginning  with 
1911,  the  annual  increase  of  steam  rail- 
road mileage,  in  operation,  was  much 
greater  in  Canada  than  in  Russia.  The 
total  increase  of  Russia's  mileage  during 
the  four  years  before  the  War  amounted 
to  2,600  miles,  whereas  the  increase  of 
Canada's  mileage  was  three  and  one- 
half  times  greater. 

Russia's  backwardness  is  shown  in  an 
even  greater  degree  when  the  rolling 
stock  of  these  two  countries  is  com- 
pared (See  diagrams  No.  48  and  49).  It 
needs  only  be  said  in  this  respect  that 
Canada,  with  a  population  of  8  millions, 
had,  at  the  beginning  of  the  War,  only 
slightly  less  freight  carrying  capacity 
than  Russia  with  its  180  millions.  When 
we  consider  that  the  rolling  stock  of 
Canada  was,  in  the  main,  new,  and  there- 
fore required  much  less  repairing  than 
Russia's,  which  was,  in  the  main,  old, 
hard-used  rolling  stock,  the  freight  car- 
rying capacity  of  the  railroads  of  these 
countries,  at  the  beginning  of  the  War, 
may  be  taken  as  about  equal. 

The  necessity  of  intensified  railroad 
construction  together  with  the  improve- 
ment of  the  rolling  stock  was  recom- 
mended by  numerous  governmental 
commissions,  working  on  these  ques- 
tions, even  before  the  War.  Partic- 
ularly   insistent    on    the    extension    of 


BOOOn 


4500- 


4000 


J500- 


3000 


2500 


,2000 


1500 


1000- 


500 


4161 
Annual 
Increase  of  Steam     Rcn'lroad  Mileaae 
in  Operation,  in  /fussier  and  Canaaa 


RUSSIA 


CANADA 


1901-10 


1911 


1912 


1913 


1914 


Vor  Cana<pla  Fiscal    Years     1911-12,  1912-15  etc. 


Diagram  No.  47 

railway  mileage  was  the  Commission 
under  General  Petrov,  which  found  it 
imperative  that  Russia  build  within  the 
next  decade  over  18,000  miles  of  new 
trunk  lines  and  about  7,000  miles  of 
branch  or   feeder  lines.     Another   Com- 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


53 


RoJlin(^    Stock    o-T    R<Piilway5  in    Russia    anal   Ccinacfpi 


000  n 


500- 

C400 

(J) 

d300 

o 

SL 

1-200 


100 


NUMBER     OF     FREIGHT    CARS 


RUSSIA 


IT) 


<3^ 


CO 
O 


N 
^ 

K^ 

<S^ 

1^ 

C\J 

^> 

l<^ 

<^ 

vs 

-< 

CNJ 

^ 

•^ 

f<^ 

CARS  OWNED 
BY  RUSSIAN 
STATE  RAILWAYS 


CARS  OWNED 

BY  RUSSIAN 

PRIVATE 

RAILWAYS 


CANADA 
«0 


OOO 

ooo 

OOO 

ooo 
ooo 
ooo 


ooo 
ooo 
ooo 
ooo 
ooo 
ooo 
ooo 
oo  o 
oo  o 
ooo 


TOTAL     CARRYING      CAPACITY 


OF     FREIGHT      CARS 


o 


* 


RUSSIA 


CANADA 


to 


r500 


-400 


o 

o 


1-300  o 


IX) 

■200   o 


100  H 


■0 


^Fiscal  years    endint^  June  50.    ^^Approximate  Data. 


Diagram 

mission,  which  worked  somewhat  later, 
in  the  early  part  of  1914,  under  the 
direction  of  the  Ministry  of  Finance, 
also  advocated  the  construction  of  18,- 
000  miles  of  new  railroads,  8,500  of 
which  were  to  be  begun  in  1915. 

But  the  endless  friction  between  the 
various  governmental  departments, 
which  was  so  characteristic  of  the  old 
regime,  stood  in  the  way  of  the  realiza- 
tion of  even  these  "modest"  plans,  as  ex- 
perts called  them.  No  advance  was  ever 


No.  48 

made  beyond  the  frequent  appointments 
of  new  consultative  bodies  which  merely 
repeated  or  slightly  modified  the  plans  of 
the  preceding  commissions.  To  this 
category  belongs  the  Consultative  Board 
created  in  1916  by  the  Ministry  of 
Ways  and  Communications,  under  the 
chairmanship  of  the  Assistant  Minister, 
I.  N.  Borisov.  This  new  body  called 
attention  to  the  need  of  increasing  the 
mileage  of  the  railroads  and  auxiliary 
branches  operating  in  the  Donetz  Min- 


54 


RUSSIA  ^  HER  ECONOMIC  PAST  AND  FUTURE 


eral  Basin  and  to  the  construction  of  a 
number  of  new  railways  to  this  Basin,  in 
order  to  stimulate  a  more  rapid  devel- 
opment of  the  coal  and  metallurgical 
industries  in  that  region.  To  aid  the 
mining  industry  of  the  Urals,  and  to 
regulate  the  heavy  traffic  of  the  Si- 
berian freight,  which  was  growing  at 
the  rate  of  20%  annually,  the  Commis- 
sion insisted  on  the  construction  of  a 
second  track  in  Siberia,  or  of  a  new 
trunk  line  between  the  main  centers  of 
Russia  and  Central  Asia.  The  Commis- 
sion, thereupon,  came  to  the  conclusion 
that  without  a  number  of  new  and  pow- 
erful trunk  lines,  equipped  for  heavy 
and  continuous  transportation,  the  reg- 
ular exchange  of  freight  between  the 
most  important  centers  would  become 
more  and  more  impaired,  until  it  would 
seriously  interfere  with  the  economic 
development  of  the  whole  country. 

It  is  very  important  to  note  that 
this  Commission,  which  submitted  its 
report  to  the  Government  of  the  old 
regime,  came  to  the  conclusion  that  the 


Carry/n^    CerpCfc/fy    of  Frelqh'h 
Cars    in   Russia  cincpl  Ccinctda 
(1912-1913) 

(gSS  RUSSIA 

PF;>rAP,T^    1        \CAN^DA 

50- 
45- 

PSR  niLE  OF  LIMES 

IN   OPE  RAT/ ON 

«>40  - 
^35- 

:-- 

a.25- 

20  - 

c  15  - 

~  10  - 

5  - 

0  - 

-14   § 

-12" 
-10   o 

-  8   i/i 

-  6    I 

-  4    i 

x 

c 

OOOOOOOOOOOO 

OOOOOO  OO  oooo 

OOOOOOOOOOOO 
OOOOOOOOOOOO 

[o_o  o  o 

Diagram  No.  49 


annual  new  mileage  to  be  built  during 
the  tive-year  term,  1917-1921,  inclu- 
sive, should  amount  to  4,150  miles, 
and  for  the  next  live-year  period,  to 
1,400  miles  annually,  without  count- 
ing strategic  railway  lines.  The  total 
increase  of  Russia's  mileage  for  the 
ten  years  from  1917  to  1926  was  to 
amount  to  28  or  30  thousand  miles.  If 
this  plan  is  realized,  Russia  will  have 
by  1927  a  railroad  mileage  of  70,000  or 
75,000  miles,  i.e.,  three  and,  one-half 
times  less  than  the  mileage  of  the 
United  States  in  1914.  But  even  if  the 
modest  plans  prepared  by  the  Borisov 
Commission  were  carried  out  fully,  the 
average  number  of  miles  per  10,000 
population  or  per  1,000  square  miles  of 
territory  would  still  be  somewhat  lower 
in  Russia  than  in  such  an  economically 
backward  country  as  Austria-Hungary. 
On  a  basis  of  75,000  miles  of  railroads 
Russia  would  have,  in  1927,  4.5  miles 
of  railroad  per  10,000  population,  and 
9.4  miles  of  railroad  per  1,000  square 
miles  of  territory.  Austria-Hungary 
had  in  1914,  5.7  miles  of  railroad  per 
10,000  population,  and  11.2  miles  of 
railroad  per  1,000  square  miles  of  terri- 
tory. 

In  order  to  raise,  by  1927,  the  mileage 
per  10,000  of  population  and  per  1,000 
square  miles  of  area  to  the  level  of 
Austria  -  Hungary's  in  1914,  Russia 
would,  therefore,  have  to  increase  her 
mileage  to  about  95,000  miles,  i.  e.,  to 
build  an  additional  50,000  miles  in- 
stead of  28,000,  recommended  by  the 
Borisov  Commission. 

As  regards  the  expenditures  neces- 
sary to  carry  out  these  plans,  so  modest 
in  comparison  with  Russia's  insistent 
needs,    the    Borisov    Commission    calcu- 


Irl 


o 


RUSSIA  ~  HER  ECONOMIC  PAST  AND  FUTURE 


55 


lated,  in  accordance  with  costs  prevail- 
ing at  that  time,  that  an  appropriation 
of  not  less  than  one  and  a  half  billion 
dollars  would  be  required  to  complete 
the  first  part  of  the  program,  from  1917 
to  1921.  At  present  cost  of  construc- 
tion, however,  this  sum  would  have  to 
be  increased,  for  the  first  five  years,  to 
two  and  a  half,  if  not  three  billion  dol- 
lars, and  for  the  entire  decade,  to  at 
least  four  billion  dollars.  When  it  is 
considered  that  the  railroad  system  of 
Russia,  during  the  War,  and  under  the 
stress  of  the  Revolution,  fell  into  a 
state  of  almost  total  dilapidation,  there 
is  no  question  that  it  now  needs  a  thor- 
ough overhauling  and  repairing.  In 
view  of  this,  the  total  expenses  for  rail- 
road construction  and  repairing  would 
considerably  exceed  five  billion  dollars. 

In  addition  to  these  undertakings  it 
will  be  necessary,  in  order  to  bring 
Russia's  railroad  system  into  proper 
working  condition,  to  make  enormous 
investments  for  the  increasing  and  re- 
pairing of  its  completely  worn-out  roll- 
ing stock.  The  increase  of  Russia's 
mileage,  during  the  next  decade,  to  70,- 
000  or  75,000  miles  will  necessitate  the 
purchase  of  at  least  400,000  new  freight 
cars,  including  20,000  or  25,000  refrig- 
erators, not  less  than  15,000  new  loco- 
motives, and  at  least  30,000  to  35,000 
passenger  cars  of  various  classes.  These 
purchases  will  require  approximately 
the  following  sums : 


400,000  freight  cars,  with 

a   carrying   capacity   of 

1,200,     2,400     or     more 

poods  at  $2,000  per  car, 

on  the  average $800,000,000 

15,000  locomotives  at  $45,- 

000  to  $50,000  each ....  700,000,000 
Passenger     cars,     newest 

types,  at  $12,000  to  $15,- 

000  each 450,000,000 


*A  freight  car  would  require,  annually,  an  aver- 
JflnnV'^rL^^"  '°  ^?,°'  ^  '°comotive,  not  less  than 
fV'^.  [°  V;Tii^""",='">':  ='"d  a  passenger  car,  about 
^l,iMJ  to  $1,^110,   each  year,  for  repair  expenses. 


$1,950,000,000 
Besides  this,  there  will  be  required, 
during  the  next  ten  years,  not  less  than 
$1,600,000,000  to  keep  the  rolling  stock 
in  proper  repair.*  The  sum  total,  there- 
fore, for  all  items  of  rolling  stock  which 
would  insure  proper  functioning  of  Rus- 
sia's railroads  would  amount  to  at  least 
$3,500,000,000. 

The  location  of  the  railroads,  project- 
ed by  the  Borisov  Commission,  is  shown 
on  the  accompanying  map. 

In  speaking  of  intensified  railroad 
construction,  it  is  important  to  state 
that,  according  to  expert  calculations, 
each  new  railroad-mile  in  Russia  re- 
quires for  building  about  200  tons  of 
metal,  five-eighths  of  which  is  for  the 
rail,  and  the  remainder  for  other  pur- 
poses. For  the  construction  of  4,000  to 
5,000  miles  of  railways,  annually,  Rus- 
sia will  require,  together  with  supplies 
of  metal  for  new  rolling  stock,  replace- 
ment of  rails  on  the  old  roads,  repairs 
of  the  old  rolling  stock,  bridges,  etc., 
etc.,  about  2,000,000  tons  of  iron  and 
steel.  In  order  to  satisfy  these  de- 
mands, the  metallurgical  industry  of 
Russia  will  have  to  increase  its  produc- 
tivity at  least  50%.  To  accomplish  this, 
Russian  steel  and  iron  plants,  in  view 
of  probably   very   high   prices   for   raw 


56  RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


materials,  labor  and  other  products,  will  to    raise    the   productivity   of   the   coal 

have  to  expend,  for  a  number  of  years  mines,    to    increase    the    production    of 

to    come,    not    less    than    $600,000,000.  coke,  the  output  of  iron  and  manganese 

This    will    not   include,   of   course,    the  ores,  as  well  as  all  other  products  neces- 

correspondingly  large  expenses  required  sary    for    railroad    construction. 


CHAPTER  VII. 


Natural  Resources 

Minerals:      Basin   of   Donetz  —  The   Ural    Region  —  The   Caucasus  —  Siberia. 
Forests  —  Furs  and  Hides  —  Fishing  —  Fruit,  Rice  and  Tea  —  Silk  — 

Flax  —  Cotton  —  Wool. 

THE  natural   resources   of   Russia  In  the  Donetz  Basin  there  are  also 

are     distributed     very     unevenly.  extensive  factories  for  the  manufacture 

The  central  section  of  European  of  chemical  products, — soda,  acids,  am- 

Russia  is  comparatively  poor  in  miner-  moniac  salts,  heavy  oils,  coal-tars,  etc., 

als.    Furthermore,  such  minerals  as  are  etc. 

found  there,  particularly  the  coal  and  Though,  under  a  more  enlightened 
iron,  are  not  of  high  grade.  economic  policy,  other  regions  of  Russia 
Almost  all  important  deposits,  partic-  v^^ould,  undoubtedly,  play  a  correspond- 
ularly  of  high-grade  minerals,  are  found  ingly  more  important  role,  none  the  less, 
in  the  outlying  regions  of  European  Rus-  in  the  next  ten  years,  the  region  of  the 
sia:  in  the  Basin  of  the  Donetz  and  on  Donetz  and  its  environs  will  probably 
the  Kerch  Peninsula,  in  the  Urals  and  be,  as  before  the  War,  the  most  produc- 
their  environs,  in  the  Caucasus  and  in  tive  section  of  Russia.  In  the  first  place, 
the  White  Sea  region,  or  in  the  various  both  the  development  of  this  region  as 
parts  of  Siberia.  well  as  the  working  of  its  deposits  of 
Basin  of.  the  Donetz.  minerals  is  a  comparatively  recent  mat- 
Up  to  the  present,  the  most  productive  ter,  and  in  the  second  place,  there  are, 
region,  that  which  has  supplied  Russia  even  now,  immense  quantities  of  prac- 
with  the  most  important  minerals,  has  tically  unexplored  deposits.  In  this  con- 
been  the  Basin  of  the  Donetz,  with  the  nection,  it  is  sufficient  ta  point  out  that 
territory  adjoining  it  along  the  shores  of  coal  and  other  minerals  are  constantly 
the  Azov  Sea.  being  discovered  in  numerous  new 
To  show  the  significance  of  the  Donetz  places,  and  furthermore,  that  the  esti- 
Basin  it  is  sufficient  to  quote  the  follow-  mated  extent  of  the  deposits  of  various 
ing  figures,  giving  the  production  of  minerals  existing  there  is  constantly 
coal,  coke,  iron  ore,  iron,  manganese  and  growing.  The  iron  ore  deposits,  for  ex- 
salt,  for  the  years  1912  and  1913,  for  that  ample,  in  the  Krivoi-Rog  district  are  at 
region,  and  also  the  average  annual  pro-  present  estimated  to  amount  to  200,000,- 
duction  of  all  Russia:  000  metric  tons,  while  only  some  years 
Production      ''in^^r     '^''^'the""  ^So,  they  were  estimated  at  50,000,000 

in  Russia    Donetz  Basin*  Donetz  Basir  ^q    100,000,000  tOnS.      In  addition,   CUOr- 

Metric  tons     Metric  tons        %  of  total  .             . 

Coal   34,000,000      23,000,000      about  70%  mous    quantities    of   various    iron    ores 

frt^.-.;::::SS       SSo         -    '^S  have     been     found     in     some     dozen 

^oVa°n'isted:aS       SS        "      3^  Other   places   in   the   Kerch   Peninsula, 

Salt   610,000         190,000         "      33%  of    which    the   surveyed   portion    alone 

^^^""^*--     ^.          ^           "      ''''"  amounts     to     at     least     1,000,000,000 

♦Including  nearby  regions.  .    -        .                   i-'i  •                •            -                i.- 

tBefore  the  War,  coke  was  also  produced,  but  in  very  metric     tOnS.         i  hlS     region    IS    partlCU- 

tATrageToTmi  Ind  wlf"  ^''''"'-  ^^rly   well    located,    for   it   is   near   the 


58 


RUSSIA --HER  ECONOMIC  PAST  AND  FUTURE 


sea,  thus  permitting:  cheap  freights  to 
both  inland  and  foreign  markets. 

The  Ural  Region 

Iron 

In  addition  to  the  resources  of  the 
Basin  of  the  Donetz,  which  adjoins  the 
Black  and  Azov  Seas,  immense  natural 
resources  also  exist  in  the  Ural  region. 
Up  to  the  present  the  Ural  iron  indus- 
try has  developed  slowly,  because  of 
the  lack  of  a  good  metallurgical  coke. 
Of  the  total  production  of  iron  ore  in 
Russia,  the  Urals  furnished,  in  the  years 
1912  and  1913,  about  295^o,  of  the  total 
production  of  coal  in  Russia  3.2%  *  of 
the  total  production  of  pig  iron  20%,  of 
the  total  production  of  iron  and  steel 
about  177c.t  Now  that  coal  fit  for  the 
production  of  coke,  and  with  a  very 
small  percentage  of  sulphur,  has  been 
found  in  the  Basin  of  the  Kuznetsk,  the 
future  of  the  iron  industry  of  the  Urals 
may  be  looked  upon  as  extremely  promis- 
ing, provided  that  the  region  be  sup- 
plied with  sufficient  rail  and  waterway 
facilities. 

What  splendid  promise  there  is  in 
this  respect  in  the  Urals  may  be  seen 
from  the  fact  that  only  one  mountain, 
Magnitnaya,  in  the  southern  portion  of 
this  region  (government  of  Orenburg), 
has  resources  of  over  100,000,000  tons 
of    magnetite    ore.      First-class    ore    is 


*One  type  of  iron,  the  production  of  which  was  very 
highly  developed  in  the  Urals,  was  that  of  sheet  iron 
for  roofing.  Of  the  total  output  of  this  product  in 
Russia,  the  Urals  furnished  about  60  per  cent. 

fThe    coal   production    of    the    Urals    was    rapidly 
growing,  as  may  be  seen  from  the  following  data: 
Years  Production 

1910  43,000,000  poods 

1911         42,400,000      " 

1912  57,500,000      " 

1913     73,500,000      " 

1914    84,200,000      " 


found  in  enormous  quantities  in  the  dis- 
trict of  Zlatoust.  Still  larger  deposits 
of  iron  ore  exist  in  the  middle  and  north 
Ural  region.  The  single  mountain  of 
Blagodat  has,  for  example,  resources  of 
over  100,000,000  tons  of  magnetite.  The 
district  where  the  Alapaev  Works  are 
located  has  also  resources  of  over  100,- 
000,000  tons  of  iron  ores.  Immense  re- 
sources of  iron  ore  have  also  been  dis- 
covered in  the  Nijni-Tagil  district,  and 
in  the  district  of  Bogoslov.  To  sum- 
marize, the  surveyed  resources  of  high 
grade  iron  ores  in  the  Ural  region 
amount,  according  to  statements  of 
Professor  Bogdanovich,  to  at  least  500,- 
000,000  tons,  but,  as  a  matter  of  fact, 
these  resources  must  be  really  much 
greater,  as  immense  tracts  have  not  yet 
been   explored. 

x\ll  the  important  metallurgical  spe- 
cialists in  Russia  are  of  the  opinion  that 
upon  changing  from  wood  fuel  to  coke, 
the  productivity  of  the  iron-works  of 
the  Urals  will  be,  in  a  relatively  short 
time,  at  least  doubled.  Up  to  the  pres- 
ent time,  there  have  existed  in  the  Ural 
iron  district  some  eighty  blast-furnaces, 
with  a  total  annual  capacity  of  about 
1,000,000  tons  of  pig  iron,  while  the 
Donetz  Basin,  with  some  forty-seven 
blast-furnaces,  has  produced  about  2.6 
million  tons.  The  producing  capacity 
of  the  Ural  furnaces  was,  therefore,  at 
a  much  lower  level. 

Copper 

The  Ural  region  has  had  to  render  up 
first  place,  as  far  as  iron  is  concerned, 
to  the  Basin  of  the  Donetz.  But,  in  cop- 
per, on  the  other  hand,  the  Urals  rank 
first  among  all  Russian  copper  produc- 
ing localities.  On  the  average,  the  Urals 


RUSSIA  ~  HER  ECONOMIC  PAST  AND  FUTURE 


59 


have  supplied  in  recent  years  over  1,- 
000,000  poods  (about  17,000  metric  tons) 
of  copper,  i.e., half  of  the  total  production 
of  all  Russia.  Copper 'is  obtained  there 
from  sulphur  ores,  which  are  constantly 
being  found  in  new  localities.  The  most 
important  copper  producing  works  are 
those  of  Kishtim,  which  supplied,  in 
1913,  about  486,760  poods  (8,000  metric 
tons),  or  about  one-half  of  the  total 
production  of  the  Urals,  and  about  one- 
fourth  of  the  total  production  of  Russia. 
The  second  place  was  taken  by  the 
Bogoslov  plants,  which  produced,  dur- 
ing the  same  year,  about  249,360  poods 
(about  4,100  metric  tons),  that  is,  about 
50%  of  the  production  of  the  Kishtim, 
25%  of  the  total  production  of  the 
Urals,  and  about  12%^  of  the  total  pro- 
duction of  Russia. 


World's    Annual    Average  Producfion 
of   Platinum,  in     Troy     Ounces 
(19/2  -  1914) 


Diagram  No.  SO 


Other  Mineral  Resources 


Still  further,  the  Ural  region  is  one  of 
the  most  important  localities  in  Russia 
for  the  production  of  precious  metals, 
and  especially  platinum.  As  far  as  this 
last  metal  is  concerned,  Russia  has  al- 
most a  world-monopoly.  Out  of  the 
average  annual  world  production,  from 
1912  to  1914,  of  280,000  troy  ounces, 
Russia's  share  was,  as  may  be  seen 
from  diagram  No.  50,  over  94%.  One 
country  only,  British  Columbia,  was  a 
relatively  important  competitor,  with  a 
production  of  about  5%  of  the  total 
production  throughout  the  world. 

During  the  last  few  years  platinum 
was  found  in  the  Urals  in  many  new 
localities;  but  the  War  has  hindered  the 
development  of  this  industry,  as  it  was 
almost  impossible  to  get  sufificient 
dredging  machinery,   as   well   as  other 


World's    Annual    Averaqe    Produciion 
of   Gold,    in    fill  I  ions    of  Dollars 
(1910   -  1915) 


Diagram  No.  51 


60 


RUSSIA  — HER  ECONOMIC  PAST  AND  FUTURE 


implements  necessary  for  working  up 
these  deposits. 

As  far  as  gold  is  concerned,  the  an- 
nual average  production  from  1910  to 
1913,  as  may  be  seen  from  diagram  No. 
51,  amounted  in  value  to  about  $30,000,- 
000,  that  is,  about  one-fifteenth  of  the 
total  world  production. 

Of  this  gold,  the  share  of  the  Urals, 
for  the  years  1912  and  1913,  amounted 
to  nearly  207o.  In  this  connection,  it  is 
necessary  to  state  that  the  methods  of 
working  in  the  mines,  not  only  in  the 
Urals  but  also  in  the  remainder  of  Rus- 
sia, are  usually  most  primitive,  so  that, 
with  better  methods  of  working  them, 
the  share  of  the  Urals  in  the  world's 
output  would  be  incomparably  greater, 
as  a  remarkably  large  number  of  rich 
gold  lodes,  shown  on  the  accompanying 
map,  have  been  worked,  if  at  all,  by 
very  wasteful  methods. 

As  regards  silver,  although  the  main 
deposits  are  located  in  the  Altai  region 
(Siberia),  the  greater  part,  before  the 
War,  was  produced  by  the  Urals.  Thus, 
for  example,  in  the  year  1912,  the  Urals 
produced  about  666  poods  of  silver,  the 


*The  four  old  oil  fields  in  Baku,  which  were,  for- 
merly, almost  the  only  sources  for  the  supply  of  oil 
ill  Russia,  are  now  beginning  to  show  signs  of  exhaus- 
tion. But  in  other  fields,  the  production  of  oil  is  rap- 
idly increasing,  as  may  be  seen  from  the  following 
data : 

OIL  PRODUCTION 

In  millions  of  poods 

Years        Binagadi  Sourakhani  Sviatoi     Grozni      Emba 

1910 9  10.4  1.4  74.0  — 

1911 7  19.7  2.6  752  — 

1912 10  31.4  3.3  65.4  1.0 

1913 14.6  39.7  4.7  73.7  7.0 

1914 21.9  51.3  6.0  98.4  16.6 

Furthermore,  oil  is  produced,  at  present,  on  the  island 
of  Cheleken,  in  Maikop,  in  Ferghana,  in  Trans-Caspia 
(near  the  Caspian  Sea  and  the  Trans-Caspian  railway), 
in  Sakhalin. 

Extensive  oil-fields  are  located  between  the  Caspian 
Sea  and  the  Urals.  Oil  is  also  found  near  Ekaterino- 
dar,  Samara,  Taman,  in  Oukhta,  etc.,  etc. 


Caucasus  some  257  poods,  while  the 
production  of  Siberia  was  almost  neg- 
ligible. 

One  other  source  of  wealth  of  the 
Urals  must  be  mentioned, — large  de- 
posits of  pyrites,  asbestos,  marble,  phos- 
phate rock,  graphite,  materials  for  the 
manufacture  of  high-grade  cement,  as 
well  as  important  deposits  of  coal,  peat, 
salt,  lead,  mica,  manganese,  mercury, 
nickel,  chromic  ores,  etc.,  etc.  In  addi- 
tion, there  are  deposits  of  semi-precious 
stones  and  rare  metals,  such  as  osmium, 
irridium,  molybdenum,  etc.,  etc. 

The  Caucasus. 

The  Caucasus  should  undoubtedly  be 
mentioned  as  one  of  the  richest  parts 
of  Russia.  In  addition  to  the  large 
naphtha  industry,  which  has  won  for 
itself  an  important  place  in  the  world 
market,*  the  Caucasus  has  one  of  the 
very  largest  deposits  of  manganese  and 
copper  ore,  as  well  as  deposits  of  silver 
and  lead  ores. 

To  show  the  important  role  which  the 
Caucasus  has  played  in  the  realm  of 
Russian  natural  economy,  the  following 
data  are  sufficient.  The  share  of  the 
Caucasus,  in  the  total  of  each  of  the 
products  listed  below,  was: 

Averages  for 
Products.  1912  and  1913 

Naphtha about  85% 

Copper  Ore "  31% 

Copper "  30% 

Manganese  ore "  70% 

Silver  and  lead  ores. . .  "  56% 

Lead "  96% 

Silver "  24% 


u 


c 


RUSSIA --HER  ECONOMIC  PAST  AND  FUTURE 


61 


As  far  as  manganese  ore  is  concerned, 
which  is  one  of  the  most  important  of 
the  resources  of  the  Caucasus,  the  ex- 
port of  this  product,  before  the  War, 
was  greater  than  from  any  other  coun- 
try in  the  world,  as  is  shown  in  diagram 
No.  52.  How  rapidly  the  exports  of 
manganese  grew  is  evident  from  dia- 
gram No.  53,  which  shows  that  from 
1904-1906  to  1913  their  volume  increased 
two  and  a  half  times. 

The  exports  of  manganese  from  Rus- 
sia, in  the  years  1911  to  1913,  totalled 
924,000  metric  tons.  This  was  notice- 
ably more  than  the  total  of  exports  of 
the  same  product  from  British  India  and 
Brazil,  which  countries  take  second  and 
third  place,  after  Russia,  in  respect  to 
the  quantity  of  this  product  exported. 
Almost  all  the  high-grade  manganese 
exported  from  Russia  came  from  the 
Caucasus,  and  particularly  from  the 
region  of  Chiaturi. 

As  for  copper,  the  Caucasus  produced, 
on  the  average,  for  the  years  1912  and 
1913,  600,000  poods.  Of  this  quantity, 
over  one-third  (231,500  poods)  was  pro- 
duced in  1913,  by  the  Akhtal-Caucasian 
Industrial  and  Metallurgical  Corpora- 
tion, and  not  much  less  (over  203,000 
poods)  by  the  Caucasus  Copper  Indus- 
trial Company. 

In  addition  to  all  the  above,  the  Cau- 
casus region  is  also  famous  for  the  pro- 
duction of  silk,  for  its  fruits,  which  have 
been  especially  developed  during  the 
last  few  years,  for  its  excellent  tea  plan- 
tations, and,  finally,  for  its  medicinal 
waters,  watering  places  and  bathing 
beaches,  which,   if  properly  developed. 


might  make  the  Caucasus,  with  its  nat- 
ural beauty,  far  exceeding  that  of  Swit- 
zerland, Italy  or  Norway,  and  with  its 
climatic  conditions,  one  of  the  most  im- 
portant watering-places  and  beaches  for 
all  Europe. 

Central  Section  of  Russia. 

The  resources  in  iron  of  the  govern- 
ments of  Vologda,  Arkhangel,  Olonetz, 
Kostroma,  Perm,  Novgorod,  Moscow, 
Tver,  Tula,  Kaluga,  Riazan,  Vladimir. 
Nijni-Novgorod,  Tambov.  Voronezh, 
Vitebsk  and  Pskov,  far  exceeded  one 
billion  tons,  although  these  deposits  are 
not  of  so  high  a  grade  as  those  of  the 
Urals  and  other  parts  of  Russia. 


Annucfl  Averc^cje    Exporis    of 

Man(^cinese   Ore    from    i-he 
mos-f-  impori-efni-    Mcrnc^cinese 
Producin(^    Countries 
(let I  -  1913) 


,1000- 

S 

jO  900- 

<S^ 

cs>800- 

O 

c 

h- 

o   700- 

C4-  600- 

o 

500- 

(0 

5 

<0 

1  400- 

$ 

^0 

K 

CK 

^  300- 

5: 

D 

«o 

^o 

1  200- 

^ 

^    100- 

?3 

OQ 

c 

5 

0 

OQ 

D 

iagram  N 

o.  52 

(>2 


RUSSIA  ~~  HER  ECONOMIC  PAST  AND  FUTURE 


The  same  is  true  of  the  deposits  of  coal 
existin,c:  in  the  governments  of  Moscow 
and  Riazan  and  other  governments  of 
Central  Russia.  Only  during  recent 
years,  owing  to  the  shortage  of  fuel,  has 
the  working  of  these  deposits  been  in- 
creased. This  coal,  as  experience 
showed,  together  with  the  turf,  might 
undoubtedly  be  very  profitably  utilized 
by  central  electric  power  stations, 
which,  aflfording  a  supply  of  cheap 
energy,  would  give  an  impetus  for 
the  further  development,  in  these 
regions,  of  various  branches  of  in- 
dustry, especially  those  producing  fin- 
ished goods.  In  this  connection  it  must 
be  stated  that  Central  Russia  is  the  most 
important  region  for  the  production  of 
cotton  goods,  woolen  stuffs,  silk  fabrics, 
linens,  perfumery,  rubber  goods,  ma- 
chinery and  fine  steel  products,  electric 
apparatus  and  implements,  pottery  and 
glass  wares,  cement,  beet  sugar,  etc.,  etc. 
(See  page  93). 

In  the  north-eastern,  northern  and 
north-western  parts  of  this  region  great 
quantities  of  flax  are  grown,  of  which 
product  Russia  was  one  of  the  main  ex- 
porting countries.     (See  page  73.) 

Siberia 

As  regards  Siberia,  her  natural  re- 
sources are  concentrated,  for  the  most 
part,  in  the  Altai  Mountains,*  in  the 
(Trans-Baikal**  territory)  districts  of 
Nerchinsk  and  Barguzinsk,  in  Ferghana, 
in  the  ^'akutsk  province,  in  the  Mari- 
time province  and  on  the  Island  of  Sakh- 
alin. 


The  coal  beds  of  Siberia  are  located 
at  comparatively  short  distances  from 
each  other,  along  the  entire  length  of 
the  Siberian  Railroad.  Many  deposits 
of  coal  are  found  in  different  parts  of 
the  Maritime  province  as  well,  and  on 
the  Sakhalin,  in  the  Altai  Mountains,  in 
Ferghana  and  in  various  parts  of  the 
Yakutsk  province.  Excellent  coal  is  also 
found  in  the  Kuznetsk  mines,  south  of 
Tomsk,  which  are  far  richer  than  those 


*South-Eastern  section  of  the  government  of  Tomsk. 

**The  Baikal  is  one  of  tlie  greatest  basins  of  fresh 
water  in  the  world.  It  has  about  30,000  square  versts 
(13,100  square  miles)  of  surface,  with  a  length  of 
about  400  miles,  and  a  width  of  17  to  47  miles. 


Annual  Expor-ts      of 

Manc^(^ne5e      Ore 

from     Russia 

p90 

[^ 

-80  15 

o 

-70    o 

1 — 

-GO 
-50    o 

CM 

X 

-40    ^ 
-30  .2 

NT) 

1       1       1 
—     ro 
o    o    o 

In    Mill 

Diagram  No.  S3 


RUSSIA  "  HER  ECONOMIC  PAST  AND  FUTURE 


63 


of  the  Donetz  Basin.  Very  rich  l;)eds 
are  also  found  in  the  region  of  the 
Angerski  mines  (Tomsk  Government), 
in  the  region  of  the  Cheremchovski 
mines  (Irkutsk  Government),  and  in  the 
region  of  the  Suchanski  mines  (Mari- 
time province).  The  coal  output  in  these 
sections  was  growing  slowly  before  the 
War,  because  industry  in  general  was 
almost  undeveloped  in  Siberia,  and  the 
export  of  coal  to  the  Urals  and  other 
parts  of  Russia  was  almost  impossible, 
owing  to  the  lack  of  railroads,  highways 
and  waterways. 

What  has  been  said  concerning  coal 
applies  also  to  the  iron  deposits  in  the 
Minusinsk  district,  to  man)'  places  in 
Ihc  Irkutsk  government,  in  the  Trans- 
Baikal  region,  in  the  Amour  region  (the 
basin  of  the  Zeia),  in  the  Ussuri  region, 
in  the  Maritime  province  (near  the  Gulf 
of  Olga),  in  the  Altai  district,  in  the  Ya- 
kutsk region,  etc.,  etc. 

As  far  as  gold  is  concerned,  out  of 
the  average  production  of  3,635  poods, 
for  the  years  immediately  preceding  the 
War  (1912  and  1913),  the  share  of  Si- 
beria was  about  3,000  poods,  i.  e.,  about 
80%.  Enormous  deposits  the  value  of 
which  it  is  possible  to  judge  from  the 
reports  of  specialists,  exist  in  the  Vitim 
district  (Irkutsk  government),  in  the 
Trans-Baikal  region  (Nerchinsk  and 
Barguzinsk  districts),  in  numerous 
places  in  the  province  of  Yakutsk,  par- 
ticularly along  the  Lena  and  the  Aldan 
rivers,  in  the  Amour  region  (Zeisky  and 
Bureinsky   districts),   in    the    Maritime 


*Zinc  ores,  to  an  amount  of  over  1.000.000  poods,  an- 
nually, were  mined  before  the  War,  near  the  Bay  of 
Tutikhe.     They  were  exported  to  Europe. 

**Tn  the  Trans-Baikal  arc  found  acquamarines,  Ceryls 
of  all  colors,  tourmalines,  topaz,  rock-crystal,  etc.. 
etc.  Furthermore  there  are  found,  in,  many  places 
in  Siberia,  especially  in  the  .Altai  Mountains,  jasper, 
lapis-lazuli,  etc.,  etc. 


province  (south  and  southwest  from 
Nikolaevsk,  and  nothwest  and  northeast 
from  Vladivostok),  in  the  Altai  district, 
in  many  places  in  the  Minusinsk  and 
Ycnissei  districts,  in  Turkestan,  in  the 
Kirgees  prairies,  etc.,  etc. 

Ores  with  a  large  percentage  of  silver, 
zinc  and  lead  occur  in  the  Trans-Baikal 
region,  in  the  Maritime  province*  and 
in  various  places  in  the  government  of 
Tomsk,  etc.,  etc.  Up  to  the  present,  in 
view  of  the  unenlightened  policy  of  the 
old  regime,  and  lack  of  ways  of  com- 
munication, they  have  not  been  utilized, 
as  is  evident  from  previously  given  data 
(see  page  20.).  This  characteristic  lack 
of  development  holds  true  not  only  of 
Siberia,  but  of  Russia  as  a  whole. 

Tin,  according  to  the  reports  of  many 
specialists,  exists  in  very  rich  deposits 
in  the  region  between  Chita  and  Man- 
churia. Particularly  well  known  are  the 
deposits  on  the  Onon  River,  near  the  rail- 
way station  of  Oloviannaya. 

Furthermore,  in  the  Trans-Baikal 
region,  not  far  from  the  Borzia  railroad 
station,  there  are  very  rich  beds  of 
Wolfram  ores. 

Throughout  all  Siberia,  there  are  also 
rich  deposits  of  copper  and  pyrites. 
Copper  is  found  in  great  quantities  in  the 
Minusinsk  district,  in  many  places  of  the 
regions  of  Akmolinsk  and  Semipala- 
tinsk,  in  the  section  between  Tashkent 
and  Kokand,  around  the  Nerchinsk,  etc., 
etc. 

Besides  this,  there  are  in  Siberia 
rich  deposits  of  graphite,  phosphate 
rock,  mercuric  ores,  chromic  ores,  sul- 
phur, salt,  asphalt,  materials  for  high- 
grade  cement,  asbestos,  mica,  antimony, 
amber,  semi-precious  stones  (district  of 
Nerchinsk**)  rare  metals  (radium,  va- 
nadium, uranium). 


64 


RUSSIA      HER  ECONOMIC  PAST  AND  FUTURE 


Great  natural  resources  exist  also  in 
the  region  between  the  Baltic  and  the 
White  Seas,  from  Petrograd  to  Onega 
Bay.  Throughout  all  this  region  there 
are  immense  forests  of  fir  and  pine, 
suitable  for  ships  and  ships'  masts.  In 
the  interior,  often  cropping  to  the  sur- 
face, there  lie  deposits  of  iron  and  cop- 
per ore,  gypsum  and  alabaster.  On  the 
shores  of  the  lakes  there  are  quantities 
of  first-class  quartz  sand,  suitable  for 
the  manufacture  of  glass.  Huge  areas 
abound  in  strata  of  excellent  marble,  in 
other  places  there  are  beds  of  coal,  and 
to  the  northwest  is  found  naphtha. 


While  speaking  of  the  character  of 
the  natural  wealth  of  Russia,  and  in 
particular  of  Siberia,  it  is  necessary  to 
note  here  that  really  scientific  investi- 
gation of  the  resources  of  Russia  has 
been  begun,  properly  speaking,  only  in 
recent  years.  Very  large  districts  in 
the  Caucasus,  in  the  Urals,  the  White 
Sea  region,  Turkestan  and  Siberia  have 
not  yet  been  surveyed,  but  for  their 
reputed  wealth  we  have  authoritative 
statements  of  experts. 

How  necessary  it  is  that  these  rich 
natural  resources  be  subjected  to  an  ade- 
quate and  scientific  investigation  will  be 
quite  evident  from  the  following  consid- 
eration :  In  the  Yakutsk  region,  accord- 
ing to  the  frequently  quoted  reports  of 
Bosenko,  there  are  immense  resources 
of  coal,  iron,  gold,  amber,  various  semi- 
precious stones,  marble,  etc.  Only  in 
very  recent  years  have  65  deposits  of 
coal,  50  of  iron,  41  of  marble  and  27  of 
gold  been  discovered. 

A    number    of   authorities    long   ago 


pointed  out  that  for  the  stimulation  of 
interest  in  the  development  of  the  inex- 
haustible wealth  of  Russia,  the  Govern- 
ment should  offer  rewards  in  propor- 
tion to  the  value  of  the  mine  discovered, 
the  quantity  and  quality  of  minerals, 
their  location,  etc.,  etc. 

If  the  subsidies  were  sufficient  to 
balance  the  expenses  of  those  who,  de- 
voting themselves  to  this  work,  found 
satisfactory  deposits  of  various  min- 
erals, the  development  of  Russia's  nat- 
ural resources  would  receive  an  excellent 
stimulus.  These  deposits,  without  doubt, 
would  be  rapidly  worked  up,  particular- 
ly if  the  experts  in  the  service  of  the 
Government  should  help  those  engaged 
in  exploration. 

It  is  to  be  hoped  in  consequence  that 
the  new  Government  will  proceed  in  this 
direction,  which  will  assist  in  bringing 
into  Russia  energetic  specialists  as  well 
as  foreign  capital. 

FORESTS 

Possibly  one  of  the  most  important 
sources  of  Russia's  wealth  are  her  im- 
mense forests.  The  total  area  covered 
by  these  forests  (including  unsurveyed 
areas)  is  about  1,170,000.000  dessiatines, 
that  is,  about  3,150,000.000  acres.  Of 
this  total,  142,000,000  dessiatines  (about 
383,000,000  acres)  are  located  in  the  51 
governments  of  European  Russia,  about 
5.000,000  dessiatines  (about  13,500,000 
acres)  in  the  Caucasus,  and  about  20,- 
000,000  dessiatines  (about  54,000,000 
acres)  in  Central  Asia.  As  far  as  Si- 
beria is  concerned,  it  has  about  204,000,- 
000  dessiatines  (about  551,000,000  acres) 


RUSSIA --HER  ECONOMIC  PAST  AND  FUTURE 


65 


^rea  under  forests  in  Russia 


Total  about 
1,110,  000,000 

Dessiafines 


1100-1 


1000- 


900 

.E  ^^Q 

4- 
C5 

'^   700 

Q 

600 


o 


500- 


400- 


■£  300- 


-  200 


100- 


0- 


k 
o 

5^ 


I 


* 


^S?5  CM 


iS"*: 


^ 


[CENTRAlJ'* 
r J    ASIA 

\\(}9.d) 

'CAUCASUS^* 
(4.9) 


\ 


*Not,  i)icluding  Poland  and  Finland. 
** National  Forests  only. 


Diagram  No.  54 


66 


RUSSIA  —  HER  ECO.XOMIC  PAST  A\D  FUTURE 


surveyed,*  and  about  800,000,000  dessia- 
tines  (about  2,160,000,000  acres)  abso- 
lutely unexplored. 

As  regards  the  distribution  of  forest 
areas  in  different  regions  of  European 
Russia  and  Siberia,  the  data  is  given  as 
far  as  surveyed  forests  are  concerned, 
in  diagram  No.  54. 

The  most  important  of  the  forest 
areas  of  European  Russia  are  located  in 
the  Government  of  Arkhangel  (40.7% 
of  the  total  forest  area  in  European 
(Russia),  in  the  Goverriment  of  Vologda 
(27.1%),  in  the  Government  of  Perm 
(8.5%),  in  the  Government  of  Olonetz 
(6.2 /-c),  and  in  the  Government  of  Viat- 

ka  (4.2%)- 

In  Siberia  the  greatest  area  of  sur- 
veyed forest  is  located  in  the  Gov- 
ernment of  Tobol  (30.97"  of  the  total 
surveyed  forest  area  in  Siberia),  in  the 
Maritime  province  (17%),  in  the  Gov- 
ernment of  Tomsk  (16.9%),  in  the 
Amour  province  (16%),  and  in  the 
Trans-Baikal  province  (8.8%). 

How  immense  is  Siberia's  wealth  in 
forests  may  be  seen  from  diagram  No. 
55,  in  which  the  forest  areas  of  Russia 
are  coinpared  with  those  of  the  United 
States  and  Canada.  It  shows  clearly, 
that  the  United  States  and  Canada  to- 
gether possess  about  one-third  as  great 
a  forest  area  as  that  of  the  total  of 
Russia. 

The   role   the   timber  exports   played 


*One  of  the  newest  publications  of  the  Ministry  of 
Agricuhure,  issued  in  1914,  gave  the  area  of  surveyed 
forests  in  Siberia  as  270000,000  dessiatines  (about  731.- 
000,000  acres),  out  of  which  240.000,000  dessiantines 
(about  650,000,000  acres  were  state  owned  forests — 
15,000,000  (about  40,500,000  acres)  were  crown  for- 
ests, and  15,000,000  dessiatines  (about  40,500,000 
acres)  belonged  to  the  Cossacks. 

.^s  this  publication  states,  the  majority  of  Siberian 
forests  consist  of  foliage-bearing  trees,  but  there  are 
also  immense  areas  covered  by  very  high-grade  cedar, 
fir,  pine  and  spruce  forests,  mostly  unexplored. 


ill  Ru.ssia  in  the  last  decade  is  shown  by 
diagram  No.  56.  From  the  data  given 
there,  it  may  l)e  readily  seen  that  the 
timber  exports  from  Russia  were  rapid- 
ly growing,  the  total  increase  during 
the  decade  of  1904  to  1913  representing 
a  growth  in  value  from  73,2  to  164,9 
million  roubles,  that  is,  about  1257'c. 

In  speaking  of  the  growth  of  Russian 
timber  exports,  it  is  very  important  to 
state  that,  while  in  Russia  they  were 
rising  year  b}^  year,  in  the  United  States 
different  conditions  obtained.  Under 
the  influence  of  the  constantly  growing 
demand  for  timber,  the  United  States, 
from  the  beginning  of  the  XXth  cen- 
tury, has  shown  a  considerable  excess 
of  imports  over  exports,  which,  ever 
increasing,  surpassed,  in  1917,  $240,000,- 
000  (see  diagram  No.  57).  It  may  be,  in 
this  way,  that  the  Russian  forests 
will  serve  as  a  very  important  source 
for  the  supply  of  various  valuable 
products  for  American  industries.  This 
may  be  seen  from  the  fact  that 
Russia's  forests  give  her  the  ability 
to  export,  with  few  exceptions,  almost 
all  the  varieties  of  timber  demanded  by 
the  world  markets,  in  large  quantities.  In 
this  respect,  it  needs  only  be  mentioned 
that  enormous  areas  in  Russia  are  cov- 
ered by  high-grade  varieties  of  cedar, 
fir,  oak.  pine,  spruce,  etc.,  etc.  Besides 
this,  vast  forest  areas  supply  splendid 
material  for  the  production  of  wood 
pulp  and  matches. 

A  large  demand  for  Russia's  timber 
would  surely  restilt  in  a  betterment  of 
her  financial  conditions.  It  is  sufiicient 
to  state,  in  this  respect,  that  before  the 
War,  the  net  income  which  the  Govern- 
ment received  from  the  state  owned  for- 
ests in  European  Russia  did  not  exceed 


Rl  SSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


67 


12  cents  ])er  acre,  i.e.,  titty 
to  a  hundred  times  less 
than  in  nidic  developed 
countries. 

In  Asiatic  Russia  the  net 
income  amounted  to  one- 
tenth  of  a  cent  ])er  acre. 

How  jxxirly  the  Forest 
Survey  was  organized  in 
Siberia  may  be  seen  from 
the  fact  that  the  bud<^et 
for  1914  gave,  for  this  pur- 
pose^ a  sum  covering  only 
the  salaries  and  mainte- 
nance of  588  ])ersons. 
Among  this  number  were 
35  forest-inspectors,  220 
foresters,  68  assistants  and 
258  rangers,  with  170  addi- 
tional persons  for  the  in- 
vestigation of  unexplored 
forest  areas, making  a  total 
of  753  persons  for  an  area 
of  several  billions  of  acres 
of  forest  area. 


Timber    Area    in    Countries     possessincj     tlie 
most    imporfant    Fores-/-  Reserves 


*  Not  inc/uding  Poland  and  Finland 
** Ncil-ional  Forests    only. 


Exports  of     Timber      from 

Russia 

(1904  -  1913) 

<^ 

^.   t       riso 

CM   ^  KJ,^, 

ID 

to    CM    i\i  r-— 1 

5: 

^^ 

-160   a> 
-140-5 

r      "^    -■  i 

o 

^5^ 

-120  Oi 

r^ " 

<J^ 

-100  <*. 
o 

^-^ 

-60  , 

-  60   § 

> 
^ 

^ 

^ 

<3^ 
Ci 

^ 

^^ 

$>) 

;ri 

-  40  .- 

i: 

^ 

<J^ 

(J^ 

C^ 

Cft 

<S^ 

cr> 

CYi 

CVv 

cvi 

-  20   t- 

^- 

"~ 

^-^ 

\ 

^ 

^^ 

^ 

u 

Diagram  Xo.  56 


Diagram  No.  55 

FURS  AND  HIDES 

Before  the  War,  Russian  furs  played 
an  important  role  in  the  world  market, 
although  a  large  part  of  the  profits, 
gained  in  the  fur  industry,  went,  as  is 
known,  to  the  Germans,  who  almost 
wholly  took  into  their  hands  the  color- 
ing and  other  WM)rking  up  of  the  furs. 
Since  the  War,  part  of  the  work  of 
finishing  the  furs,  formerly  done  by  the 
(iermans,  went  to  England,  France  and 
America. 

The  principal  furs  exported  from  Rus- 
sia were  squirrel,  skunk,  sable,  ermine, 
otter,  beaver,  muskrat,  fox,  lynx,  panth- 
er, tiger,  wild  cat,  bear,  wolf,  hare, 
marmots,  badger,  as  well  as  sheepskins, 
etc.,  etc. 


68 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


According  to  Russian  statistics,  the 
average  annual  value  of  the  exported, 
unfinished  furs,  for  the  five-year  period 
from  1909  to  1913,  was  8.3  million  dol- 
lars. It  is  necessary  to  notice,  however, 
that  the  declared  value  of  these  exports 
was  inexact, — the  true  value,  undoubt- 
edly, being  much  higher. 

By  doing  away  with  the  destructive 
and  wasteful  methods  of  hunters,  and 
by  bettering  the  ways  of  communica- 
tion to  the  North  of  Russia  and  to  Si- 
beria, the  exports  of  furs  will  undoubt- 
edly be  greatly  increased. 

The  same  considerations  hold  true  re- 
garding   hides.      Notwithstanding    the 


immense  territory  suitable  for  cattle- 
breeding,  this  industry,  as  was  stated 
above,  has  been  at  a  very  low  level. 
This  is  sufficient  to  explain  the  fact 
that,  for  the  five-year  period  from  1909 
to  1913,  the  average  annual  value  of 
the  exported,  unfinished  hides  was  15^ 
million  dollars,  that  is,  several  times 
less  than  in  Argentine.  In  addition,  it 
is  also  important  to  notice  that  for 
this  same  five-year  period,  Russia  im- 
ported hides,  finished  and  unfinished,  to 
the  amount  of  almost  19  million  dollars, 
i.e.,  more  than  she  exported,  while  the 
imports  of  Argentine,  in  this  respect, 
were  almost  nearlicrible. 


Foreign    TrcPi<ple    in     Timber     in    Russia     (?in(p/    the 

Uni-f-ed         Sfcpfi-es 


UNITED  STATES      EXCESS 
OF    IMPORTS    OVER     EXPORTS 


RUSS/AS  EXCESS  OF 
EXPORTS   OVER   IMPORTS 


1 — \ — I — I — I — \ — I — r 

240  220  200  180  160  140  120   100  80    60  40    20 
In      Millions       of 

*  Preliminary. 


0 
Do 


0    20   40 
I  a  rs 


60  80 


Diagram  No.  57 


RUSSIA  ^  HER  ECONOMIC  PAST  AND  FUTURE 


69 


FISHING  official  statistics  published  by  the  De- 

The  rivers  and  lakes  of  both  European  partment  of  Agriculture  give  the  follow- 

and   Asiatic    Russia   have   always   been  ing  data  concerning  the  catch  of  fish  in 

famous  for  their  abundance  of  fish.    The  Russia,  in  1913: 

Regions  Poods 

Volga-Caspian 17,802,000 

Kura-Caspian 8,384,000 

(V^ithout  the   waters  of   I'ctrovsk  and   Derbcnt)  4g2  000 

Western  Black  Sea 

Arkhangel 1,202,000 

Far  East 7,993,000 

(Siberian  waters) 


Value 

26,0  million  dollars 
9,5       " 
0,85     " 


A  little  more  than  half  of  the  total 
(19,1  million  poods)  were  herring. 

These  statistics  are  not  thoroughly 
reliable.*  The  total  of  the  products  of 
the  fishing  industry  in  Russia  was  esti- 
mated, in  1913,  at  about  64  million  poods, 
in  value  $85,000,000. 

The  following  varieties  of  fish,  in 
great  profusion,  are  found  in  the  rivers 
and  lakes  of  European  Russia:  White 
sturgeon,  other  kinds  of  sturgeon,  sal- 
mon, white  fish,  carp,  sandre,  perch,  her- 
rings, pike,  gremille,  tench,  crucian, 
bass,  gang-fish,  eels,  etc.,  etc. 

The  lower  part  of  the  Volga,  and 
the  Caspian  Sea  have  always  been  fam- 
ous for  yielding  the  highest  grade  of 
caviar.  The  Siberian  rivers  and  lakes 
are  overcrowded  with  fish,  the  most 
usual  being  dififerent  varieties  of  salmon. 
The  dififerent  kinds  of  Siberian  sturgeon 
are  also  well  known.  The  cheap  Sibe- 
rian caviar  has  recently  begun  to  be  ex- 
ported in  large  quantities  to  European 
Russia. 


*  The  reorganization  of  fishing  statistics  was 
started  only  just  before  the  War.  The  poor  value 
of  the  older  statistics  is  proven  by  the  fact  that  the 
quantity  of  fish  caught  for  the  market  (not  count- 
ing that  taken  for  private  use),  was  stated  as  being, 
for  the  years  immediately  preceding  the  War,  eight 
pounds,  per  capita,  annually. 


35,903,000  

The  seas  which  border  on  European 
and  Asiatic  Russia  are  also  good  fishing 
grounds.  Large  quantities  of  cod  were 
taken  on  the  Murman  coast  (from  1910 
to  1913,  about  544,000  poods,  on  the 
average,  annually),  from  which  was  ob- 
tained, in  the  same  years,  about  44,000 
poods  of  cod-liver  oil,  annually. f  Sal- 
mon are  caught  in  the  White  Sea,  also, 
as  well  as  herrings  (from  1910  to  1913, 
about  282,000  poods,  annually)  and 
dorse  (from  1910  to  1913,  about  170,000 
poods,  annually). 

Enormous  quantities  of  fish  are  found 
throughout  Siberia,  particularly  within 
the  limits  of  the  Akmolinsk  and  Semi- 
palatinsk  regions,  in  the  Government  of 
Tobol,  along  the  Yenissei,  the  Lena  and 
Amour  rivers  and  their  tributaries,  in 
the  Sea  of  Aral,  in  the  Baikal  Lake,  etc., 
etc. 

Various  kinds  of  fish  are  caught  in 
large  quantities  in  the  Baltic,  Caspian, 
Black  and  Azov  Seas;  and  in  Siberia, 
besides  the  Maritime  Province,  in  Sak- 
halin and  Kamchatka. 

t  The    total    fish    yield  on    the    Murman    coast 
amounted   to: 

1910 1.400.000    poods 

1911 1.500,000       " 

1912 1,700,000      " 

1913 •. 1,280,000       " 


70 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


In  the  seas  bordering  on  Siberia  there 
are  also  many  seals,  whales  and  walrus. 

The  fishing-  industry  has  been  treated 
much  the  same  as  other  industries  in 
Russia.  The  greatest  hindrances  have 
been  the  lack  of  adequate  railroads  and 
other  ways  of  communication,  lack  of 
refrigerator  cars  and  cold-storage  facili- 
ties at  the  stations,  the  lack  of  special 
schools  and  instructors,  as  well  as  fish 
breeding  stations,  and  also  the  high  cost 
of  tin-plate  for  making  cans,  high  prices 
of  salt,  etc.,  etc. 

Moreover,  the  fish  industry  has  been 
injured,  in  some  places,  by  the  rapacious 
methods  used  in  fishing,  which  resulted, 
in  some  inland  localities,  in  almost  com- 
plete exhaustion  of  the  stocks  of  fish.  A 
diminution  of  the  stock  of  fish  was  also 
observed  in  the  Black  and  Asov  Seas. 

Finally,  the  fact  that  there  has  been 
no  supervision  of  the  disposal  of  waste 
from  the  industrial  plants  and  factories, 
has  resulted,  often,  in  poisoning  the  riv- 
ers and  lakes  and  destroying  huge  quan- 
tities of  fish. 

How  insignificant  were  the  sums  as- 
signed by  the  old  Government  for  the 
development  of  this  important  industry 
may  be  seen  from  the  fact  that  during 
the  years  just  before  the  War,  the  Gov- 
ernment gave  only  $300,000  for  all  the 
needs  of  this  industry  throughout  all 
Russia,  i.e.,  about  $1  per  capita  of  peo- 
ple employed  in  it.* 


*The  number  of  persons  employed  amounted  to  : 

Volga-Caspian  region 127.500 

Kura-Caspian   region    43.500 

Arkhangel  region  54.900 

Far   East   (Siberian   waters)....     30,200 


256,100 


In  view  of  the  narrow-minded  and 
short-sighted  Governmental  policy  con- 
cerning this  industry,  we  cannot  wonder 
at  the  fact  that,  even  with  such  an  enor- 
mous supply  of  fish  in  Siberia,  which,  if 
well  conserved,  could  supply  not  only 
the  whole  of  Russia,  but  also  furnish  a 
large  surplus  for  exportation,  Russia  has 
been  obliged  to  import,  annually,  very 
large  quantities  of  salted  and  canned 
fish.  In  the  years  1911-13  the  imports 
averaged  some  $18,000,000,  while  the  ex- 
ports, including  caviar,  amounted  only 
to  $4,200,000.t 

If  the  new  Government  takes  the  ne- 
cessary measures  in  the  industries  dis- 
cussed above,  Russia  will  undoubtedly  in 
some  years  become  one  of  the  greatest 
fish  exporting  countries  in  the  world. 

FRUIT,  RICE  AND  TEA 

The  climatic  conditions  of  Central  and 
South  Russia  (particularly  in  the  latter 
region,  in  the  Crimea,  in  Bessarabia  and 
the  Government  of  Kherson),  as  well 
as  those  of  the  Caucasus  and  Turkestan, 
are  most  favorable  for  the  growing  of 
fruit. 

In  Central  Russia  there  are  grown  ex- 
cellent grades  of  apples,  pears,  cherries 
and  plums,  and  all  kinds  of  berries, — 
strawberries,  blackberries,  raspberries, 
etc.,  etc.,  which  are  used,  in  enormous 
quantities,  in  the  manufacture  of  jams, 
jellies  and  preserves  of  all  kinds. 

In  the  Caucasus  and  in  Turkestan  *  • 
there  are  grown  high-grade  oranges, 
mandarins,  pomegranates,  lemons,  figs, 
peaches,  apricots,  almonds,  etc.,  etc.    In 


t  The  exports  of  caviar  amounted  to  175,000 
poods,  in  value  $2,000,000.  About  .34  of  the  amount 
of  high  grade  caviar,  exported  from  Russia,  went  to 
Germany,  from  which  country  it  was  re-exported  to 
France,  England,  the  United  States,  etc.,  etc. 


*  *Turkestan,  in  the  year  1912,  according  to  official 
statistics,  had  about  75,000  acres  devoted  to  grape 
culture,  and  the  same  acreage  for  the  growing  of 
fruit.  In  reality  the  acreage  was  much  greater.  The 
most  important  fruit  districts  are  in  the  Ferghana 
region,  and  the  most  important  grape  growing  dis- 
tricts in  Samarkand. 


RUSSIA  ~  HER  ECONOMIC  PAST  AND  FUTURE 


71 


the  Governments  of  South  Russia  (Bes- 
sarabia, Kherson,  Crimea,  Astrakhan), 
as  well  as  in  the  Caucasus  and  in  Turk- 
estan, grapes  are  grown,  wliich  give 
excellent  wines,  well  known,  not  only  in 
Russia,  but  in  Europe. 

Some  of  the  wines  are  exported  and 
sometimes  brcmght  back  to  Russia,  un- 
der foreign  labels,  mixed  with  French, 
Spanish  and  Italian  wines.  Some  vari- 
eties of  grapes,  particularly  those  of 
Turkestan,  are  used  for  the  production 
of  raisins  and  dried  currants. 

The  suitability  of  the  climate  of  Tur- 
kestan for  fruit  growing  is  shown  by  the 
following  facts:  About  the  end  of  April, 
roses  begin  to  bloom ;  by  the  middle  of 
May,  cherries  are  ripe;  by  the  middle  of 
June,  apples,  pears,  peaches  and  melons 
are  on  the  market.  Apricots,  almonds, 
plums,  pomegranates,  figs,  nuts,  quinces, 
pistachio  nuts,  and  watermelons  also 
ripen  early.  Turkestan  is  famous  for  its 
excellent  grade  of  pears,  and  apples, 
some  of  the  latter  weighing  two  or  three 
pounds  each.  The  exporting  of  fruit, 
both  canned  and  fresh,  before  the  War, 
was  -almost  entirely  to  Russia. 

Watermelons,  produced  not  only  in 
Turkestan,  but  in  all  the  Governments 
of  South  Russia,  the  Caucasus,  in  the 
southern  parts  of  the  Siberian  Govern- 
ments of  Tomsk  and  Yenissei  (district  of 
Minusinsk),  in  the  southern  part  of  the 
Amour  and  Maritime  Provinces,*  have 
an  excellent  future.  Most  famous  are 
the  watermelons  of  Astrakhan,  which 
are,  however,  grown  in  other  parts  of 
South  Russia  as  well.  Of  the  melons, 
the  most  famous  arc  those  of  Tchardjui. 


*  According  to  official  statistics,  there  was  in  all. 
in  Asiatic  Russia,  about  150,000  acres  under  melons 
and  water-melons.     Actualv,  the  acreage  was  larger. 


To  show  the  quality  of  the  soil  and 
the  nature  of  the  climate  of  this  region, 
it  is  sufficient  to  state,  that  about  50 
long  tons  of  melons  are  produced  there, 
very  often,  per  acre. 

Tea  and  rice  are  also  grown  in  the 
Caucasus  and  in  Turkestan.  The  Trans- 
Caucasian  plantations  produced  the  fol- 
lowing quantities  of  tea: 

1910 218,000  American  pounds 

1911 192,000 

1912 245,000 

1913 287,000 

1914 301,000 

Under  rice  there  were,  in  Russia,  in 
1914,  about  668,000  acres,  producing 
about  23,000,000  poods.  The  greatest 
part  of  the  rice  plantations  are  in  Tur- 
kestan (territories  of  Syr-Daria,  Samar- 
kand, Ferghana),  and  in  Trans-Cau- 
casia (Governments  of  Baku  and  Eliza- 
vetpol). 

It  is  to  be  regretted  that  the  splendid 
climatic  conditions  have  not,  until  re- 
cently, been  taken  advantage  of,  for  they 
could  afford  an  opportunity  in  this  field 
for  a  much  denser  population.  Here,  as 
in  other  instances,  as  we  have  seen,  the 
obstacles  to  better  development  were  the 
lack  of  good  railroads  and  other  ways 
of  communication,  insufficient  refriger- 
ator cars,  poor  cold  storage  facilities  in 
the  stations,  the  almost  total  lack  of 
an  entomological  survey,  lack  of  good 
and  sufficiently  numerous  schools  for 
teaching  fruit  growing,  experimental 
stations,  instructors,  and  in  addition,  the 
high  cost  of  materials  for  canning  the 
fruit  (tinplate,  sugar,  etc.).  All  these 
contributed  to  retard  the  development 
of  this  industry.  Only  to  these  causes 
can  be  attributed  the  fact  that  Russia 
has   imported   large   quantities   of  fruit 


72 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


from  other  countries,*  whereas  the  nat- 
ural climatic  conditions   should  enable 
her  to  become  one  of  the  most  important 
fruit  exporting  countries.     As  for  the 
future  of  fruitgrowing  it  must  not  be 
forgotten    that    in    Russia    itself,    the 
masses  of  the  people  consumed  extreme- 
ly small  quantities  of  fruit,  which  was 
one  of  the  important  causes  of  many  dis- 
eases among  the  lower  classes. 
SILK 
Raw  silk  is  produced  in  Russia  prin- 
cipally in  the  Caucasus,  in  Turkestan, 
and,  in  small  quantities,  in  South  Russia. 
In  view  of  the  primitive  methods  of  feed- 
ing the  worms,  the  frequently  inferior 
quality  of  the  imported  grains,  as  well 
as  the  primitive  methods  of  silk-wind- 
ing, the  quality  of  the  silk  produced,  in 
most  districts,  was  comparatively  poor. 
Before  the  War,  the  total  quantity  of 
silk  produced  in  Russia  was  not  more 
than  2%  or  3%  of  the  world  production. 
In  various  parts  of  the  country  the 
production    of   cocoons,    for    the    years 
1911-13,  was  as  follows: 
Governments  of  Kherson, 
Bessarabia,     Crimea, 
Kiev,   the   territory   of 
the  Don  Cossacks,  etc.f  21,200  poods 

North  Caucasus 1,000 

Trans-Caucasia  310,000      " 

Ferghana 197,000       " 

Other  territories  of  Tur- 
kestan    75,000      " 

All  Turkestan   272,000       " 

Bokhara 19,000       " 

Area 
Years  ('"  dessiatines) 

1901-10 1,013,000 

1911 1,026,000 

1912 1,039,000 

1913 1,099,000 

*  The  value  of  imports  averaged,  1911  to  1913,  to 
$15,000,000. 

t  Average  for  1912-13. 


The  undeveloped  state  of  the  silk  in- 
dustry in  Russia  has  been  due  to  the  fact 
that  the  old  government  began  to  give 
attention  to  it  only  in  the  years  immedi- 
ately preceding  the  War. 

By  establishing  a  sufficient  number  of 
grain  investigation  stations,  special 
schools,  a  good  entomological  survey, 
increasing  the  number  of  instructors,  as 
well  as  by  giving  a  better  education  in 
general  by  means  of  the  elementary 
schools,  the  production  of  silk  in  Russia 
will  undoubtedly  be  brought  to  a  very 
high  state  of  development,  as  is  shown 
by  the  fact  that  even  the  very  small  out- 
lays on  the  part  of  the  Government  in 
recent  years,  have  had  successful  results. 
The  extremely  favorable  climatic  con- 
ditions, as  well  as  the  relatively  low  cost 
of  labor,  could  make  the  Caucasus,  as 
well  as  Turkestan,  the  most  important 
silk-producing  regions  of  the  world. 

FLAX 

In  the  exporting  of  flax  fibre,  Russia 
occupies  the  first  place  in  the  world. 

The  area  devoted  to  the  growing  of 
flax  in  Russia  amounted,  in  1913,  to 
1,515,400  dessiatines.  Since  the  begin- 
ning of  the  twentieth  century,  it  has  not 
rapidly  increased,  as  may  be  seen  from 
the  following  data  concerning  27  prin- 
cipal flax-growing  governments  of  Rus- 
sia: 

Production  of  Fibre 
(in  poods) 

24,223,000 
I  21,741,000  ) 

^  1,055,000    32,455,000  h  28,700,000 
'   '         31,910,000  ' 


RUSSIA       HER  ECONOMIC  PAST  AND  FUTURE 


73 


The  increase  was,  in  the  main,  due  to 
the  larger  acreage  devoted  to  flax  in  the 

Yearc 
Governments  1901-10 

Smolensk 92,100  dessiatines 

Tomsk 21,000 

Tver    93,100 

Moghilev 2G,600 

The  most   important   places   for   the 
growing  of  flax,  in  Russia,  were,  for  the 


following  governments: 

Year 

1913  Increase 

134,500  dessiatines  42,400  dessiatines 

40,700  "  19,700 

111,200  "  18,100 

34,800  "  8,200 


years  1909-1913,  as  follows: 


Governments 

Smolensk 3,097,000 

Tver 2,353,000 

Viatka 2,127,000 

Livonia   1,983,000 

Pskov 1,969,000 

Kovno  1,222,000 

Vitebsk   1,157,000 

Vladimir 1,127,000 

Perm    ...1,048,000 

Kostroma   963,000 

Yaroslav 950,000 

Vologda 674,000 

In  these  twelve  governments,  com- 
prising about  three-fourths  of  the  area 
devoted  to  flax  in  the  27  principal  flax- 
growing  governments,  about  three- 
fourths  of  the  total  was  produced. 

Very  fine  fibre  was  produced  in  recent 
years  in  Siberia,  particularly  in  the  Gov- 
ernments of  Tomsk  and  Yenissei,  after 
the  Inland  Colonization  Bureau  had 
turned  its  attention  to  the  development 
of  this  industry.* 

The  finest  grades  of  flax  are  produced 
in  the  Government  of  Vologda,  the 
prices  for  which  were,  at  times,  100% 
higher  than  those  for  the  flax-fibre  pro- 
duced in  other  districts. 

If  sufficient  special  schools  and  experi- 
mental  stations  were   established,   and 


*  During    recent   years,   flax    fibre   has   been   pro- 
duced also  in  the  Trans-Baikal  and  Amour  Provinces. 


Fibre  produced  Area 

poods  111,800  dessiatines 

98,100 
114,800 
67,800 
94,600 
41,900 
48,300 
38,800 
47,400 
44,000 
38,500 
27,900 

sufficient  instructors  provided,  then  the 
production  of  flax  in  Russia,  and  its  ex- 
port would  undoubtedly  play  a  much 
greater  role  in  the  World  Market  than 
before  the  War. 

To  show  what  an  important  role  Rus- 
sia has  played  as  a  flax  exporting  coun- 
try, it  is  sufficient  to  point  out  that  the 
country  second  in  rank  in  this  export, 
Austria-Hungary,  exported,  in  the  years 
1909-1913,  on  the  average,  only  6%  of 
the  exports  of  fibre  from  Russia. 

How  rapidly  the  demand  for  Russian 
fibre  has  been  growing  in  the  World 
Market,  since  the  beginning  of  the 
twentieth  century,  may  be  seen  from 
the  following  official  data: 

Years  Russian  exports  of  fibre 

1901-05 11,900,000  poods 

1906-10 13,900,000   " 

3911-13 15,900,000   " 


74 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


In  1912  and  1913  the  average  value  of 
the  exports  of  flax  amounted  to  $43,- 
000,000. 

The  most  important  markets  for  Rus- 
sian flax  were  Belgium,  the  United 
Kingdom,  Germany  and  France. 

Among  the  linen  producing  countries 
Russia  was,  after  the  United  Kingdom 
and  France,  third  in  rank. 

COTTON  CULTIVATION 

The  growing  of  cotton  in  Turkestan 
dates  back  for  many  thousands  of  years. 
Probably  the  cotton  originally  came 
from  India  by  way  of  Persia  or  China. 

Disregarding  its  ancient  history,  cot- 
ton growing  in  Turkestan  has  pro- 
gressed but  slowly  and,  up  to  recent 
times,  met  only  local  demands. 


The  main  hindrances  in  the  develop- 
ment of  this  industry  were,  on  the  one 
hand,  the  inferior  quality  of  the  tibre 
and,  on  the  other  hand,  the  difficulties 
of  transportation,  as  it  had  to  be  carried 
to  distant  railroad  stations  or  river  ports 
by  camel,  under  strong  caravan  guard. 

Only  in  the  eighties  of  the  last  cen- 
tury, under  the  influence  of  some  of  the 
more  enlightened  representatives  of  the 
government,  was  the  cultivation  of 
American  cotton  started.  Since  the 
growing  of  American  cotton  was  more 
profitable,  it  soon  displaced  the  cultiva- 
tion of  the  native  variety. 

How  rapidly  the  growing  of  cotton 
developed  in  Turkestan,  since  the  Rus- 
so-Japanese War,  may  be  seen  from  the 
following  data,  showing  the  areas  under 
cotton,  in  thousands  of  dessiatines: 


Years  Ferghana 

1902-04 164,8 

(After  the  Russo-Japanese  War) 

1905  166,0 

1906 180,0 

1907  199,9 

1908 168,7 

1909 201,5 

1910 237,2 

1911  265,1 

1912  255,6 

1913* 274,9 


Reg 
Syr-Daria 

ions 
Samarkand 

Trans-Caspia:i 

Total 

14,6 

12,6 

15,2 

207,2 

13,2 

18,8 

13,3 

211,3 

27,3 

14,0 

11,0 

232,3 

44,4 

22,5 

21,9 

288,7 

23,8 

21,9 

30,3 

244,7 

26,4 

18,6 

26,2 

272,7 

38,0 

25,2 

28,3 

328,7 

49,0 

29,1 

34,5 

377,7 

64,6 

27,1 

37,7 

385,0 

67,8 

31,8 

45,7 

420,2 

From  1902-1904  to  1913  the  total  area 

under  cotton  increased  more  than  lOO^c 

The  main  cotton  supply  comes  from 


the  Ferghana  region.  Out  of  the  total 
area  under  cotton  cultivation  in  Turkes- 
tan, Ferghana  produced  65%,  the  Syr- 


*  Official   estimates  published   in   various   sources  do  not  always  give  the  same  figures.     We  use  here 
the  estimates  of  the  Ministry  of  Finance  and  the  Ministry  of  Agriculture. 


RUSSIA  ~  HER  ECONOMIC  PAST  AND  FUTURE 


75 


Daria  region  about  16%,  the  Trans-Cas- 
pian about  11%  and  the  Samarkand 
about  8%.  If  we  add  to  this  the  areas  of 
the  cotton-growing  districts  of  Bokhara 
and  Khiva,  the  total  acreage  under  cot- 
ton in  Russian  Central  Asia  comes  to 
1,25U,U()U  acres,  i.e.,  al^out  3.5%  of  the 
cotton  area  in  the  United  States. 

As  to  the  other  comparatively  well- 
developed  cotton  region, — the  Caucasus, 
the  acreage  under  cultivation  there  in 
the  year  1913  was  about  300,000  acres.* 
Out  of  the  total  yield  of  cotton  in  Russia 
in  that  year,  Turkestan,  Bokhara  and 
Khiva  supplied  about  8/9  and  the  Cau- 
casus about  l/9.t 

The   export   of  cotton   from    Central 

Quantities 
Years  Russian   Cotton 

1890 1,986,000 

1900 6,110,000 

1904 6,657,000 

1908 8,191,000 

1910 11,239,000 

1912-13 13,100,000 

1913-14 14,200,000 

During  recent  years  Russian  cotton 
has  averaged  over  50%  of  the  total. 

The  main  centers  of  trade  in  cotton 
in  Turkestan  are  the  cities  of  Kokand 
and  Andijan.  Both  have  many  mills  for 
the  cleaning  of  cotton  and  distributing 
agencies    both    for    cotton    and    cotton 


Asia,  figured  for  calendar  years,amount- 

cd  to  4 

Years 

1888 87,300    poods 

1890 2,673,000 

1895 2,910,000 

1900 4,960,000 

1905 5,458,000 

1910 9,430,000       " 

1911 13,181,000 

1912§ 13,697,000 

1913 12,806,000 

This  data  shows  that  cotton  growing 
developed  rapidly  during  the  last  dec- 
ade, when  the  exports  of  Central  Asia 
increased  about  2y^  times. 

How  rapidly  the  Russian  cotton  in- 
dustry has  adapted  itself  to  Russian  cot- 
ton may  be  seen  from  the  following  fig- 
ures, giving  the  amounts  of  Russian  and 
foreign  cotton  used  in  the  Russian  mills : 

of  Cotton  used  Russian  Cotton 

Foreign  Cotton  in  per  cent  of  total 

5,980,000  25% 

9,985,000  38% 

11,583,000  36% 

12,959,000  39% 

10,846,000  51% 

10,800,000  55% 

13,500,000  51% 

seeds.  Fairs  are  regularly  held  in  both 
of  these  cities  and  are  attended  by  the 
representatives  of  all  the  large  concerns 
engaged  in  the  cotton  industry  of  the 
country. 

During  the  years  immediately  preced- 
ing the  War  the  government  initiated 


*  The  Central  Statistical  Committee  quotes  lower 
figures,  i.e.,  about  240,000  acres.  The  Trans-Cau- 
casian railroads  handled,  in  the  year  1913.  about 
2,300,000  poods  of  cotton. 

t  Almost  the  same  proportion  would  obtain  for 
the  average  of  the  years  1911  to  1913  according  to 
figures  published  by  the  Central  Statistical  Com- 
mittee concerning  the  yield  of  raw  cotton  in  Turkes- 
tan and  Trans-Caucasia. 


t  In  these  figures  are  included  small  quantities  of 
cotton  coming  from  Afghanistan,  Persia,  and  other 
border  countries.  The  average  imports  from  these 
countries  did  not  much  exceed,  in  recent  years, 
500,000  poods. 

§  More  recently  published  figures  give  14,200,000 
poods. 


76 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


certain  measures  protecting  the  local 
population  against  exploitation  by  irre- 
sponsible people.  With  this  object  in 
view,  the  Russian  State  Bank  ofifered  as- 
sistance for  the  organization  of  a  num- 
ber of  Saving  and  Credit  Cooperative 
Societies.  It  is  to  be  regretted  that  both 
the  scope  of  operation  of  these  societies 
as  well  as  the  effect  on  the  prices  ob- 
tained by  the  farmers  was  insignificant. 

The  future  of  cotton  in  Turkestan  de- 
pends almost  entirely  upon  the  increase 
of  irrigated  lands.  In  this  direction  the 
old  government  did  very  little.  Instead 
of  an  irrigation  of  about  7,500,000  acres, 
which  could  have  been  easily  accom- 
plished, only  the  following  works  have 
been  completed:  Three  dams  have  been 
built  in  the  Murgab,  the  Nicholas  Canal 
in  the  Golodnaya  steppe,  and  one  other 
canal  in  the  same  district,  supplying 
water, altogether,  to  some  250,000  acres.* 

Just  as  little  was  done  by  the  old  gov- 
ernment to  further  the  cotton-seed  plan- 
tations, the  experimental  stations,  the 
supply  of  trained  instructors,  or  special 
schools. 

In  order  to  rightly  develop  the  cotton 
industry  of  Turkestan  and  the  Caucasus 
and  thereby  increase  the  annual  yield 
7-8  times,  it  would  be  necessary  to  spend 
at  least  150-200  million  dollars. 

After  such  initial  expenditures,  if 
wisely  spent,  Russia  ought  to  rank  next 
to  the  United  States  as  a  cotton-grow- 
ing country,  whereas,  before  the  War, 
Russia's  share  was  insignificant,  as  may 
be  seen  from  the  data  given  below.    The 


*  In   recent   years   a   few   new   irrigation   projects 
were  begun. 

tin  recent  6  years  the  increase  in  the  nnmber 
of  spindles  in  the  cotton  industry  of  Russia  averaged 
to  3%. 


total  world  production  was  distributed 
as  follows: 

United  States 657o 

British  India 15% 

Egypt 7% 

China 5% 

Russia 3% 

All  others 5% 

How  promising  the  future  of  cotton 
growing  in  Russia  is  may  be  judged 
from  the  fact  that  the  per  capita  con- 
sumption of  cotton  in  Austria-Hungary 
was  about  40-45%  greater  than  that  of 
Russia,  whereas  that  of  France  or  Ger- 
many was  about  three  times  that  of 
Russia. 

If  by  the  end  of  the  present  decade  the 
per  capita  consumption  of  cotton  in 
Russia  attains  the  rate  of  that  of  Ger- 
many at  the  beginning  of  the  twentieth 
century,  the  production  of  cotton  goods 
in  Russia  will  have  to  be  increased  about 
2^  times.f 

WOOL 

Russia  occupies  one  of  the  first  places 
in  the  world  so  far  as  the  number  of 
sheep  is  concerned,  as  the  following  data 
shows: 

Australia 85.1  million 

Argentine 83.5 

Russia 78.7 

United  States 49.2 

South  Africa 30.7 

United  Kingdom 28.3 

Uruguay 26.3 

New  Zealand 24.8 

British  India 23.1 

It  is  unfortunate  that  the  quality  of 
the  wool  of  the  sheep  in  Russia  was  far 
inferior  to  that  of  the  sheep  of  other 
countries.  From  the  total  number  of 
sheep  in  1914  there  were  only  5,000,000 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


77 


whose  fleece  was  high  grade,  i.e.,  only  a 
little  over  6%  of  the  total. 

It  is  necessary  to  note  that,  because 
of  the  plowing  of  large  areas  in  South 
Russia,  the  number  of  fine  fleeced  sheep 
in  the  51  Governments  of  European 
Russia  (Poland  not  included)  has  dimin- 
ished, during  the  last  decades,  from  11,- 
700,000  in  the  years  1864-1869,  to  5,600,- 
000  in  1900,  and  to  2,500,000  in  1914. 

On  the  contrary,  the  number  of  sheep, 
not  fine  fleeced,  which  supplied  wool  for 
the  use  of  the  peasants  and  the  army, 
increased  from  32,500,000  in  1864-69,  to 
42,100.000  in  1900.  In  recent  years,  how- 
ever, the  number  of  these  sheep  also 
diminished  and  in  1914  they  numbered 
only  36,400,000. 

The  number  of  fine  fleeced  sheep  has 
increased,  during  recent  years,  in  Sibe- 
ria, particularly  in  the  territories  of  Ak- 
molinsk  and  Semipalatinsk,  as  well  as 
in  the  Governments  of  Tomsk  and  Ye- 
nissei,  in  the  territory  of  Semirechensk 
and  in  Turkestan.* 

The   greatest    number   of   sheep    per 


*  The  fine  fleeced  sheep  brought  from  South  Rus- 
sia to  the  steppes  of  South  Siberia,  particularly  to 
Akmolinsk  and  Semipalatinsk,  accustom  themselves 
very  readily  to  the  new  climatic  conditions,  and  their 
breeding  with  the  native  varieties  has  given  splendid 
results,  the  wool  of  the  new  varieties  being  finer 
and  more  curly  than  that  of  either  of  the  parent 
stocks.  Each  year  has  seen  an  increase  of  90.7%, 
with  a  loss  of  only  2.5%. 


1,UUU  of  population  was  found,  in  1914, 
in  Central  Asia  (about  1850),  in  the  Cau- 
casus (about  975),  in  Siberia  (about 
603),  whereas,  in  European  Russia,  the 
number  of  sheep,  per  1,000  of  population, 
was  only  302. 

Owing  to  the  fact  that  the  demand 
of  the  World  Market  for  wool  has  con- 
stantly increased  during  recent  years,t 
whereas  the  breeders,  under  the  influ- 
ence of  the  high  prices  for  meat,  have 
slaughtered  a  large  number  of  their 
sheep,  it  seems  certain  that  the  im- 
mense steppes  of  Eastern  European 
Russia,  Central  Asia,  and  Siberia  would 
become,  after  the  construction  of  new 
railroads  and  other  ways  of  communica- 
tion, one  of  the  most  productive  centers 
of  wool  in  the  world. 

In  this  connection  it  is  sufficient  to 
state,  as  is  also  shown  in  diagram  No.  14, 
that  of  the  total  area  of  Russia,  at  the 
beginning  of  the  War,  only  about  5% 
was  under  cultivation,  thus  leaving  large 
areas  for  cattle  raising. 

tThe    total    exports   of   wool   to   Europe    and    North 
America  amounted  to: 

1894-1898 2,671,000    bales 

1899-1903 2,374,000 

1904-1908 2,574,000 

1909-1913 3,372,000 

-t-  26% 
Before  the  War  the   imports  of  wool  into  Russia 
were  considerably  greater  than  the  exports.     In  the 
years  1911-13  the  imports  into  Russia  averaged  $37,- 
000.000.  and  the  exports  only  $4,700,000. 


CHAPTER    VIII 


Russia's  Banks — Banking  and  the  Economic  Develop- 
ment of  the  Country  —  Dividends  and   Profits  in 
Various  Industries — Bolshevism  and  Russia's 
Banks  and  Industries — Past  and  Future 
of  Foreign  Capital  in   Russian 
Banking  and  Industries 


JUST  before  the  War  Russia  was  pass- 
ing through  a  period  of  considerable 
economic  prosperity,  as  may  be  seen 
from   diagram   No.   58,   which   lists   the 


average  quotations  of  the  stocks  of  Rus- 
sia's land  banks,  insurance  companies, 
commercial  banks,  railroads, as  well  as  of 
oil,  cement  and  metallurgical  industries. 


AveroKje   Quofa-tions    of  Di\//a/enof  -  oay/ng   Siocks 


_      1  A  kl n      fi  A  M  f  c                                  1 

..  — —  _  _. 

-  JN5URANCE  COMPANIES  j 

-  COMMERCIAL  BANKS        1 

i 

/ 

/ 

\r 

^ 

A 

A 

1 

^•». 

V 
X 

V 

K 

^ 

y\ 

4 

f 

■^  • 

-  ^^ 

^ 

^4 

vs. 

■7 

v: 

/ 

Quo+citions 
420 


3S6 

350 

315 

260 

245 

210 

115 

140 

105 

10 

35 


oooooo—    —    —    — 


0 


UIL    irJUUo  /  nr 

CEMENT  INDUSTRY 

INDUSTRY 

^ 

^ 

\                 / 

\                   /7 

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\              / 
\            / 

A                1! 

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K^         ■^lf)vOr-cO<T>0 
-         O    O      O     O      O     O 


<yi     G>      CD 


^     (^      ^     ff) 


Diagram  No.  58 


80 


RiSSLl~HER  ECONOMIC  PAST  AND  FUTURE 


In  looking  over  these  figures,  we  ob- 
serve that  the  prices  of  the  majority  of 
industrial  securities,  as  well  as  of  the 
majority  of  the  stocks  of  banks  and 
railroads,  have  risen,  during  the  last 
few  years,  to  a  much  higher  level  than 
in  the  period  succeeding  the  Russo- 
Japanese  war.  It  is  important  to  note, 
along  with  this,  that  the  Russian  banks, 
as  well  as  the  Russian  Bourse,  suffered 
heavily,  during  the  years  just  preceding 
the  War,  owing  to  the  detrimental  ef- 
fects of  the  Balkan  wars  and  the  storm- 
clouds  of  the  approaching  world-con- 
flagration. But  for  these  factors,  the 
average  quotations  of  Russian  stocks 
would  have  reached  an  even  higher 
level  during  the  last  few  years. 

How  fast  new  capital  was  pouring 
into  stock  enterprises  in  Russia  may  be 
seen  from  diagrams  Nos.  59,  60,  61,  62. 
The  first  of  these  diagrams  shows  the 
number  of  new  joint  stock  companies  for 
the  four  years  which  preceded  the  War 
— 1910-1913.  Each  year  the  number  of 
new  stock  companies  in  Russian  indus- 
try and  trade  has  grown  rapidly.  The 
same  may  be  said  concerning  the  capital 
of  the  new  stock  companies. 

Diagram  No.  60  shows  what  propor- 
tion of  Russian  securities.  Governmental 
and  private,  were  placed  in  foreign  and 
Russian  markets  respectively.  In  looking 
over  this  diagram,  we  find  that  during 
the  last  few  years,  with  the  exception 
of  1906,  the  value  of  these  securities, 
placed  in  Russia,  was  considerably 
greater  than  that  of  those  placed  abroad. 
For  several  years,  such  as  1907,  1908, 
1910,  1911,  etc.,  it  will  be  noticed  that 
the  total  value  of  the  securities  placed 
abroad  was  manv  times  less  than  the 


value  of  securities  placed,  for  the  same 
years,  in  Russia  itself. 

Diagram  No.  61  shows  the  capital 
stock  of  commercial  banks,  industrial 
and  trade  enterprises,  the  stock  and 
bonds  capital  of  the  railroads  and  the 
stock  and  debentures  issued  in  foreign 
markets,  as  well  as  in  Russia,  by  the 
above  mentioned  enterprises. 

Diagram  No.  62  gives  the  same  infor- 
mation for  new  issues  of  securities  by 
industrial  and  trade  companies,  as  well 
as  for  securities  issued  by  commercial 
and  land  banks  in  Russia.  From  this 
diagram  it  may  be  seen  that  the  pro- 
portion of  such  securities  held  by  Rus- 
sians hasconsiderably  increased, and  that 
each  year  the  share  of  Russian  holders 
has  been  greater  than  that  of  foreigners. 
It  is  important  to  note  also  that  the  total 
value  of  securities,  placed  both  in  Rus- 
sia and  abroad,  has  grown  very  rapidly, 
which  is  convincing  proof  that  both  Rus- 
sian and  foreign  capital  have  begun  to 
take  an  increasing  interest  in  the  eco- 
nomic development  of  Russia. 


Number  of  New    Russicn  /na/us-f-ria/ 
ana/  Commercial     Corporal-Ions 
and    their  Paid-up    Ca pi -hail 


D 


NUMBER   OF  NEW 
CORPORATIONS 

\  PAID -UP   CAPITAL 


u,  300-1 


-^250- 
o225- 

^^oo 

o 
o  175 

;  150 

^125- 
^  100- 


75- 
50- 
25- 


C5^      <J>      Ol      0> 


Diagram  No.  59 


RUSSIA  -^  HER  ECONOMIC  PAST  AND  FUTURE 


81 


In  speaking  of  the  influx 
of  foreign  capital  into  Rus- 
sia, it  is  necessary  to  state, 
as  already  indicated,  that, 
during  the  last  decades  of 
the  XIX th  and  the  early 
part  of  the  XXth  century, 
until,  say,  1908,  foreign  in- 
vestments in  Russia  were, 
for  the  most  part,  confined 
to  French  and  Belgian  cap- 
ital. But.  since  that  year, 
under  the  influence  of  the 
improved  political  rela- 
tions between  Russia  and 
England,  British  capital 
again  began  to  invade  Rus- 
sia, as  ma}^.  be  seen  from 
the  following  facts. 

From  the  year  1908,  up 
to  the  beginning  of  the 
great  World  War,  about  a 
hundred  English  concerns, 
with  registered  offices  in 
the  United  Kingdom,  have 
been  established  in  the 
Russian  oil  industry,  alone, 
with  an  authorized  capital 
and  bonds  of  about  $140,- 
000,000.*  However,  partly 
due  to  the  influence  of  the 
Balkan  wars,  practically 
one-half  of  this  sum  was 
invested  in  this  industry. 

In  addition  to  the  con- 
cerns interested  in  oil, 
there  were  also  established 
the     following    important 


*  In  this  total  is  not  included  the 
capital  placed  bj'  English  investors 
in    Russia    through    the    buying    of- 
shares    of    various    Russian    enter- 
prises. 


/Vew  Issues  of  Russian  Securifies  by  the  Government,  Inc/usfrial 
and  Commercial    Corporations ,  Railroads ,  Commercial    Banks 


900 

800 

2  TOO 

a: 
^500 

■"400 

c 
o 

Z300' 

Y. 

200- 

c 

100- 


□' 


IN  F0REI6N 
COUNT/ilES 


^ 

1 

\s> 

*^ 

i 

1 

^ 

1904         1905  I90to  1907  i90«         1909  1910  1911  1912 


Diagram  No.  60 


Cc^pifctl  of  Russian  Corporations* 

1 

SHARES  ANO 

2500 -] 

BONDS  jssueo 

BY  RAILROAD 

New  Issues  of  Russian  Securities 

2400- 

CORPORATIONS 

in  Russia  and  forei<^n  Countries 

2J00- 
2200- 
2100- 

2205 

(In   Millions  of  Roubles) 

>n2§00- 
a;  1^00- 

STOCKS  AND 

BONDS   OF 

a  laoo- 

INDUSTRIAL  AND 

=  noo- 

Si  1600- 

STOCKSANO 

COMMEffOAL 
COPPO RATIONS 

BONDS  or 

1500- 

INDUSTRIAL 

ir^o  ^ 

1400- 

<t  IJOOJ 

1200- 

AND  COMMERCIAL- 

STOCKS  AND 
iONOS   or 

CORPORATIONS 

1243 

1156 

ilOO- 

CORPORATIONS 

£  1000- 

o    900- 

COMIMERCIAL 

8412        ,„_,  ., 

-  800- 

-  700- 
^    600- 
c    500- 

-  400- 

BANKS 

14! 

COf^MERCIA 

AND   LAND 

BANKS 

eo5 

em 

4561 

300- 
200- 

2bii 

'074 

100- 

^5 
1 

Z     -^            $      2             S     s 

S    :2           §     t2 

S    ii 

o>       CT,               o       a>                a,      o 

cy      c              CT>      cr» 

c      oi 

do              o      o 
5!      £              2i      9; 

f     <y> 

■^    S        ^    -^        -^   -^ 

2      2 

*Only  including  the  Companies,  Secunttes  of  wtj 

/ch  are  cfoofval  on  the 

Russian 

Steele     Exchanc^es 

Diagram  No.  61 


82 


RiSSLi-    HER  ECONOMIC  PAST  AND  FUTURE 


English    companies,    having    registered 
offices  in  the  United  Kingdom: 

1.  Lena  Goldfields,  Limited,  registered 
July  1908,  with  an  authorized  cap- 
ital'of  $6,800,000. 

2.  Kishtim  Corporation,  Limited,  reg- 
istered October  29,  1908,  with  an 
authorized  capital  of  $7,275,000. 

3.  North  Ural  Mining  Company,  Lim- 
ited, registered  Nov.  26,  1908,  with 
an  authorized  capital  of  $1,750,000. 

4.  Anglo  -  Russian  Trust,  registered 
Nov.  1,  1909,  with  authorized  and 
issued  capital  of  about  $-4,850,000. 

5.  Russian  Chain,  Anchor  and  Testing 
Works,  registered  Nov.  30,  1909, 
with  an  authorized  capital  of  $1,- 
210,000,  and  issued  debentures  of 
about  $485,000. 

6.  British    Bank    for    Foreign    Trade 

(name  changed  to  Anglo-Russian 
Bank),  registered  January,  1911, 
with  authorized  capital  of  about 
$7,275,000. 

7.  International  Russian  Corporation, 
Limited,  registered  Feb.  21,  1911, 
with  an  authorized  capital  of 
$970,000. 

8.  Pioneer  Company  of  Siberia,  Lim- 
ited, registered  August  2,  1911,  with 
an  authorized  capital  of  $485,000. 

9.  Russo  -  Asiatic  Corporation,  Lim- 
ited, registered  April,  1912,  with  an 
authorized  capital  of  $1,450,000. 

10.  Tanalyk  Corporation,  Limited,  reg- 
istered April,  1912,  with  an  author- 
ized capital  of  $2,180,000  and  de- 
bentures of  $970,000. 

11.  Sissert  Company,  Limited,  regis- 
tered June,  1912,  with  an  author- 
ized capital  of  $4,850,000. 


12.  Russian  Anthracite  Collieries,  Lim- 
ited, registered  Sept.  18,  1912,  with 
an  auth(.rizcd  capital  of  $1,970,000. 

13.  Russian  Corporation,  Limited,  reg- 
istered March  7,  1914,  with  an 
authorized  capital  of  about  $9,- 
700,000. 

14.  Irtish  Corporation,  Limited,  regis- 
tered Nov.  27,  1914,  with  an  author- 
ized capital  of  $2,425,000. 

Important  sums  of  British,  French, 
Belgian,  Swiss,  Swedish,  Norwegian 
and  Dutch  capital  were  also  invested 
during  the  past  years  in  enterprises 
working  with  Russian  capital,  after  the 
latter  were  transformed  into  joint  stock 
companies. 

Turning  to  the  internal  money  mar- 
ket, the  enormous  increase  of  available 
capital  in  Russia  is  clearly  indicated 
by  the  data  of  the  deposits  in  the  vari- 


100 


600 


in 

i:  SOO 

D 
O 
DC 

400 
0 

H)  300 
o 


New  Issues  of  Securities    by 

/nc/usiricr/  crnd  Commercial 

Corporations,  Commercial 

Banks  and  Land  Banks 

of  Russia 


200 


100 


/V    FOREIGN 


5 


o        p        O       p       6 


c^      c>       ^       o>       o 

Diagram  No.  62 


tS>  O  <5> 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


83 


ous  Russian  banks  from  1904  to  1914. 
Upon  examining  the  figures  in  dia- 
gram No.  63  we  observe  that,  whereas 
the  deposits  in  the  State  Bank  remained 
almost  at  the  same  level  during  these 
years,  the  deposits  in  the  small  credit 
banks,  municipal  banks  and  mutual 
credit  banks  increased  almost  three- 
fold. The  same  proportion  holds  true 
for  the  increase  of  deposits  in  the  com- 
mercial banks.  Out  of  the  total  amount 
of  deposits  in  the  banks  throughout  the 
country  (approximately  four  billion 
roubles),  two-thirds  were  held  by  the 
private   commercial    banks. 

Similar  conditions  were  observed  even 
after  the  War  began,  as  shown  by 
diagram  No.  64.  In  examining  the  fig- 
ures given  in  this  diagram,  we  find  that 
the  total  amount  of  deposits  in  Russian 
commercial  banks  grew,  from  May  1, 
1915,  to  May  1,  1917,  from  3,210.00d.O(X) 
to  7,754,000,000  roubles,  i.  e.,  it  increased 
two  and  a  half  times. 

Diagram  No.  65  shows  the  assets  and 
liabilities  of  Russian  commercial  banks 
on  January  1,  1904,  and  July  1,  1913. 
In  reviewing  this  data,  we  find  that 
the  main  activities  of  these  banks  were 
the  discounting  of  bills,  and  advancing 
loans  on  various  securities.  In  the 
last  section  of  the  diagram  there  are 
given  figures  concerning  the  number 
of  branch  offices  of  Russian  joint  stock 
commercial  banks.  Regardless  of  all  ob- 
stacles placed  in  the  way  of  the  develop- 
ment of  these  banks  by  the  old  regime, 
they  expanded,  and  the  number  of  their 
branch  offices  was  constantly  increasing. 
Thus,  for  instance,  from  1904  to 
1907,  the  number  of  such  branches  in- 
creased by  37,  from  1907  to  1910  by 
132,     and      from      1910     to      1913     bv 


164.  Notwithstanding  this  notable 
growth,  it  is  necessary  to  remark  that 
the  total  number  of  branches  of  these 
commercial  banks  in  Russia,  as  well  as 
the  number  of  parent  banks,  was  ex- 
tremely small,  when  calculated  on  the 
basis  of  the  population  of  Russia.     It  is 


Increase  in    Deposits  in 
Russian     Banks 

•^    Lnvsr-oooo   —   ojro^ 
oooooo   —    —    —    —   — 

4250 
AOOO 
375  0 
3500 

0) 

^   325  0 

=>  3000 
o 

^   275  0 
2500 

0  2250 
2000 

^    1750 

°    1500 

1  1250 

1000 

c 

~     750 

500 

250 

0 

A 

1 

/  i 

1 

i 

1 

W.' . 

1 

i 

y°r.'.y 

/  fo 

•    • 

: 

L 

•y 

/ 

A 

W: 

■/I 

Lk 

'•'/ 

^ 

^iJ^ 

OZ^ 

/ 

s^ 

r^ 

t' 

1 
W/ 

i 

P 

i 

i 

y 

i 

w> 

i 

m 

o  o 
0  o 

]S/^ALL    CREDIT  BANKS 
[]  MUNICIPAL    BANKS 
[J  MUTUAL  CREDIT    BANKS 

^ 

1^ 

:of- 

TA- 

1Mt 
rE  L 

-RC 
SAI 

/AL 

B, 

OF 

'KNj 
RU 

KS 

SSI 

A 

Diagram  No.  63 


84 


RUSSIA  -  HER  ECONOMIC  PAST  AND  FUTURE 


sufiicient  to  cumpare  with  Rtissia,  in  this 
respect,  the  Dominion  of  Canada,  which 
had  in  1916,  with  a  population  of  about 
eight  million,  22  chartered  l)ank.s  witli 
3,309  branch  offices.  Among  those 
banks,  the  following  had  the  largest 
number  of  branches: 

Number  of 
Branches 
Canadian  Bank  of  Commerce.  .  .  .   376 

Royal  Bank  of  Canada 371 

Union  Bank  of  Canada 304 

Banque  Nationale   222 

Merchants'  Bank  of  Canada 202 

Bank  of  Nova  Scotia 190 

Bank  of  Montreal 182 

The  first  two  of  these  banks,  the 
Canadian  Bank  of  Commerce  and  the 
Royal  Bank  of  Canada,  alone,  had  more 
branch  offices  than  42  Russian  joint  stock 
commercial  banks  taken  together, 
though  the  capital  stock  of  these  Rus- 
sian banks  exceeded,  in  1916,  the  capital 
stock  of  these  two  Canadian  banks  15 
times. 

The  comparison  between  the  Russian 
joint   stock  commercial  banks   and  the 


Caplf-cfl  anc?/  Deposifs  in  -f-he 

Commercial  Banks*  of  Russia 

flOOO^                <0-^'-y''-')     oePOsiTS 

1.754 

1000- 

Ifl 

^  6.000-1 

Xl 

D 

0 

^  5.000- 

(^ 

°  4000- 

CM 

u-j 

'A 

§3.000- 

^  aooo- 

CAPITAL 

c 

oo      p     ~< 

1.000- 

CM      i3 

r\ 

It, 

%Jomt  Sfocic  Banks  only.  The  fo+al 
number  of  such  banks  in  Russia 

an.ounfec^  lo  41-in  I9IS  to  42- in  1916 

Cine 

^  to 

50 

-in  1917. 

Diagram  No.  64 


6200 
6000 
5S00 
5600- 
5400 
5200 
5000 
4800 
"  4600 

-  4400^ 
■^  4200- 
2  4000  - 
a.  3800- 

3600 
1^  5400 
°  5200 

5000- 
«  2800- 
^  2600 
o  2400 

-  2200 

-  2000- 
5-   1800 

1600 
c   1400 

-  1200 
iOOO- 

800 
600 
400 
200- 
0 


Sfa+emen  t 


5<o 

ON 


1741 


728 


M 


i 

18 


995 


-JSSL— _1_ 


250 


iS-f 


of        Co  ndifion 


58ZZ 


of  Commercial  Banks'* 


,'232 


I 

a* 


125 

m\   I 


Joinf  Stock    Compc^nles    Only 


ilM  Jan.  I?  1904 
I      I  July  |5*  1915 


LIABILITIES 


§1 


7<?5 


7S4 


-I 

■on 


S3§ 


liOO 


of         Russia 


103 


509 

2n^ 


5822 


154 


f 


Number     of    Branch - 

offices      of   the 
Russian    Commercial 
Banks''^ 


60/ 


Diagram  No.  65 


268r— 


-800 
-100 
600 
500 
■400 
500 
200 
100 
0 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


85 


Canadian  banks  becomes  still  more  in- 
teresting when  the  populations  of  these 
two  countries  are  taken  into  considera- 
tion. In  Canada,  there  is  a  branch  ofifice 
of  a  chartered  bank  for  every  2,400  of 
population,  whereas  in  Russia  only  one 
branch  office  is  found  for  every  250,000 
of  population,  i.  e.,  less  than  one-hun- 
dredth of  Canada's  rate.  These  figures 
prove  with  striking  clearness  the  pres- 
ent weakness  of  banking  in  Russia,  and 
show  likewise  the  excellent  opportuni- 
ties that  await  foreign  capital  in  the 
field  of  Russian  banking.  Undeveloped 
as  banking  was  in  Russia,  these 
commercial  banks  were,  none  the 
less,  paying,  during  the  years  that 
preceded  the  War,  very  high  dividends, 
often  as  much  as  20  to  30  roubles  or 
even  more  per  share  of  stock,  with  a 
par  value  of  250  roubles.  Such  divi- 
dends were  being  paid  notwithstanding 
the  fact  that  the  capital  stock  of  these 
banks  was  constantly  being  increased, 
and  notwithstanding,  also,  the  very 
conservative  policy  of  Russian  com- 
mercial banks  in  declaring  dividends. 
In  general,  only  a  small  part  of 
their  actual  profits  were  distributed  to 
share  owners,  as  shown  by  the  fart 
that  out  of  174  million  roubles  earned 
by  these  banks  in  1913,  the  dividends 
distributed  amounted  only  to  62.4  mil- 
lion  roubles. 

In  speaking  of  the  role  of  the  joint 
stock  commercial  banks  in  the  economic 
life  of  Russia,  it  is  also  necessary  to 
point  out  that  the  number  of  big  banks 
in  that  country  has  hitherto  been  very 
small.  Thus,  for  instance,  as  late  as 
1915,  Russia,  with  a  population  of  180 
million,  had  the  following  number  of 
big  banks : 


Paid-Up  Capital 
From    5  to  10  Million  Dollars 
«      10  "    15 
"      15  "    20 
"     20  "    25 
u     25  "    30 


No.  of 

Banks 

10 

5 

1 

3 

3 


Total 22 

Canada,  with  a  population  of  8  mil- 
li'in,  had,  in  1916,  the  following  number 
of  chartered  banks  with  more  than  5 
million  dollars  of  paid-up  capital,  each: 

No.  of 
Paid-Up  Capital  Banks 

From     5  to  10  Million  Dollars.  .  .        6 
"      10  "15        "  "       ...       2 

Over  15        "  "...        1 


Total. 


Moreover,  the  reserve  funds  of  the 
Canadian  chartered  banks,  which 
amounted  to  $113,383,000,  exceeded 
their  paid-up  capital,  whereas  the  re- 
serve and  other  funds  of  the  42  Russian 
joint  stock  commercial  banks  did  not 
amount  to  one-half  of  their  paid-up 
capital.  The  average  of  the  combined 
paid-up  and  reserve  capitals  of  the  Rus- 
sian and  Canadian  banks  was  approxi- 
mately the  same, — about  10  million  dol- 
lars. 


In  view  of  such  a  comparatively  weak 
development  of  banking  in  Russia  be- 
fore the  War,  there  is  no  doubt  that,  af- 
ter normal  conditions  are  restored,  bank- 
ing will  develop  there  extensively.  First, 
because  the  existing  commercial  banks 
will  extend  their  operations  through- 
out Russia  as  well  as  abroad;  and,  sec- 
ondly, because  foreign  banks  will  open 


86 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


branch  offices  in  the  most  important 
Russian  industrial  and  trade  centers,  in 
order  to  improve  their  control  over  the 
increasing  exports  and  for  the  better 
safeguarding  of  their  investments.  A 
beginning  in  this  direction  was  already 
made  before  the  War,  and  was  con- 
tinued during  the  War,  when  a  number 
of  foreign  banks,  American  among 
them,  opened  branches  in  Russia,  in 
addition  to  a  large  number  of  special 
new  foreign  banks,  such  as  the  Russian- 
English  Bank,  the  Russian  -  French 
Bank,  the  Russian-Holland  Bank,  etc., 
etc. 

In  speaking  of  the  splendid  outlook 
for  the  banking  business  in  Russia,  and 
the  high  earning  power  of  the  majority 
of  the  banking  institutions,  it  is  neces- 
sary   to    consider    the    opinions    widely 
circulated  among  the  general  public  to 
the  effect  that  the  Bolshevist  upheaval 
must  inevitably  lead  to  the  bankruptcy 
of  all  Russian  private  banking  institu- 
tions. That   this  opinion  is  wrong  can 
at  once  be  seen  from  the  fact  that  the 
only    harm    that    the    Bolsheviki    could 
have     inflicted     upon     the     commercial 
banks  would  have  been  the  confiscation 
of  the  ready  cash  which,  at  the  time  of 
the  coup  d'etat,  was  found  in  the  vaults. 
These  cash  funds,  however,  were  quite 
negligible    in    amount.      Thus,    for    in- 
stance, on  May  1,  1917,  all  the  cash  on 
hand  in  all  the  Russian  joint  stock  com- 
mercial banks  amounted  to  hardly  183 
million  roubles.     The  actual  losses  suf- 
fered by  these  banks  from  the  Bolshe- 
vist confiscation,  which  occurred  several 
months   later,  were   even   smaller,   for, 
after  their  victory,  the  Bolsheviki  con- 
tinued to  pay  out  to  depositors  on  cur- 
rent accounts,  in  the  beginning,  at  the 


rate  of  650  roubles,  and  later,  at  1,000 
roubles  per  month.  Besides,  they  also 
paid  out  very  large  sums  from  current 
accounts  when  these  went  for  the  pay- 
ment of  workers'  wages,  clerks'  sal- 
aries, etc.,  in  various  industrial  plants. 
Thus,  the  cash  losses  of  the  private 
commercial  banks  were  considerably 
offset  by  the  payments  made  by  the 
Bolsheviki  upon  current  accounts  of  the 
private  banks  from  the  funds  of  the 
State  Bank. 

Moreover,  a  number  of  the  branch 
offices  of  these  commercial  banks  were 
located  in  Siberia,  in  the  North,  and  in 
many  other  sections  of  Russia,  which 
either  were  under  the  rule  of  the  Bol- 
sheviki for  a  brief  time  only,  or  were 
not  subjected  to  it  at  all. 

Finally,  we  must  not  lose  sight  of  the 
fact  that  the  depreciation  of  the  rouble 
to  almost  nothing,  which  is  inevitable 
if  the  Bolsheviki  remain  in  power  even  a 
few  months  longer,  will  reduce  the  liabil- 
ities of  the  banks  to  a  negligible  sum. 
whereas  their  assets,  which  consist,  in 
large  measure,  of  controlling  blocks  of 
stock  in  important  industrial  enterprises 
which  own  valuable  mines,  oil  lands  and 
vast  tracts  of  timber  lands,  are  bound 
to  increase  immensely  in  value.  The 
banks  received  their  deposits  at  a  time 
when  the  rouble  was  worth  from  100  to 
50  kopecks  in  gold.*  For  this  money  the 
banks  have  purchased  various  securities 
in  Russia  and  abroad.  Now.  when  the 
exchange  rate  of  Russian  paper  money 
is  very  low,  the  banks,  in  meeting  their 
liabilities,  can  discharge  them  all  by 
liquidating  only  a  small  portion  of  their 
undepreciated  Russian  or  foreign  hold- 


*  The  latter  was  the  exchange  rate  when  the  Bol- 
sheviki seized  the  power. 


Avercptae      Nef      Prof/fs     ana/      Divi(p/e 


50 


40- 


c 

<u  30H 

o 

u  20H 


(L) 

a. 


10- 


0- 


most      Im  po  r  i-oi  n+        Russi 


iij 
or> 

<<c 
CO  t^- 
o2 


/Z7 

1^ 


NUMBER  OF  FACTORIES  17 
COMMON 5T0CK\  ^^29.1 
RESERVES  l-J-§    2.5 

SINKING  FUND  j  S  g    2.& 


>- 

UJ 

Z 

o 

I— 


o 


25.7 


JtM 


< 


X 


2^^ 


^ 


14 

9.1 

14 

4.4 

0.5 


20 
30.5 

8.5 
25.3 

4.1 


>- 

a: 

UJ 

H 
u- 

Of 

UJ 

a. 


/^3 


n 

12.6 
1.1 
3.6 


UJ  t" 


3^3 


j^ 


5 

42.5 

21.0 

202 

0.3 


>- 


>■ 
a. 


> 


FLAX 
AND 
INDU 

OQ 
02 

50-1 

^40- 

c 

Average      Net      Profits     anal      Dividends     for     fine      Yeerrs     1911-13 
mosf      Important        Russian         Industries 


the 


50 
40- 


<u  30- 
o 
u  20- 


IZJ 


NUMBER  Of  FACTORIES  17 
COMnON5rOCK\  S  2  29.1 
RESERVES  l-J-§    2.5 

SINKING  FUND  |  £  J    2.6 
BONDS  J  -^     - 


50 

:4o- 

"50- 

-20 

^0- 


<oSc 


60- 
.40i 
=  30 

L) 

■^20 
"  10 


9.6 

Mi 


NUnBER  OF  FACTORIES  24 
COMMON  STOCI<\  g  342.6 
RESERVES  .2-g    5.5 


BONDS 


it  29.0 


si 


?5.7 


L^ 


24.4 


14.5 


3(7.3 


'f0; 


is.e 


:IZ:J__1M1j. 


2^.(5 


^ 


16.4 


'Ml 


155 


14 
9.1 
14 
4.4 
0.5 


5g  in9 


26 
305 

85 
25.3 

4.1 


xq2 

<2g 


n 
life 
1.1 

3.6 


oo 


5 

423 

21.0 

202 

0.3 


12 
330 

7.6 
20.2 

3.6 


56 

140.0 

18.3 

271 

39.3 


65 
267.0 

62.0 
I02.J 

214 


7 
27.8 
3.7 
7,5 
2.9 


38 
32.5 

5.6 
139 

0.6 

§5£^ 


5 
75 
2.2 
4.2 
13 


NUMBER  OF  FACTORIES     56  13 

COMMON  STOCK]     S  gMO  19.0 

RESERVES        I    9S11.9  1.2 

SINKING  FUND  {  £^509  5.5 

BONDS             )   s's  36  0,6 


31 
55.1 
104 
32.8 

7.2 


127 

440.0 

1056 

338 

240 


31 
18.6 
1.6 
II 


?=         25 


24.6 


-  OS 


x< 
ton 


32  171 

241  565.0 

1.4  966 

5.6  157.6 

96.1 

|*-WHOI.ESALE 

i§       3 

-JO  uj 


22 
38.8 
42 
8.5 
0.8 


20 
22.3 
35 
4.4 
0.5 


5 
45 
06 


12 
10,4 

1.5 
47 
0.7 


ee 


.RETAIL 


TRADE  -  -^ 

£K3 


\2I2\ 


12.1 

21  ^e 

87.0   S£ 
3.8   ^^ 

I2fl   is 
16  6  I 


Hi 
«9^ 

/3.<S 

«3 

14.5 

(3.3 
*7^ 

201 

2/2 

237 

/53 

/3.(3 

149  £ 

166,0  Si2 

31.5   g-= 

S77  1 2 

0.6^ 


16.1 


'M ml mi 


22.9 


14.5 


14.1 


/77 


mi 


'M. 


(S5 


IM 


li.6 

Ml 


Numbers  show 
the  average  net 
profits  inpercent- 
ctqe  of  the  total 
stock  aniTi  bond 
capital  1911- li 


.'U\ 


Numbers  show 
the  dividends 
paid  for  the 
years  191  I'll  in 
percentage  of 
common  stock 


6 

14 

10 

59 

II 

9 

51 

22 

?.l 

l?.5 

106 

101 

18.2 

21,2 

7.J5 

57,3 

52,7 

19.0 

01 

2.4 

1.5 

7.8 

S4 

1.6 

4.9 

II  1 

1,3 

«.l 

2.94 

2.5 

12.0 

0.9 

0.96 

30 

10 

1.1 

0.57 

0.9 

7.4 

- 

6,6 

- 

- 

Qj  — 

25^ 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


87 


ings.  The  remaining  assets  will,  thus, 
become  unencumbered  profits  in  their 
possession. 

It  is  clear,  therefore,  that  those  who 
speak  of  the  inevitable  bankruptcy  of 
the  private  commercial  banks  of  Rus- 
sia display  unfamiliarity  with  the  situa- 
tion of  the  Russian  banks  and,  partic- 
ularly, with  the  fact  that  the  larger 
commercial  banks  have,  directly  or  in- 
directly, controlled,  in  recent  years, 
about  two-thirds  of  the  bigger  indus- 
trial enterprises  in  Russia. 

In  considering  this  point  we  must  re- 
fer to  the  question  of  Russian  currency. 
In  this  direction  it  must  be  admitted 
that  Bolshevism  has  unconsciously  ren- 
dered a  good  service  to  Russia,  namely, 
by  printing  unlimited  amounts  of  paper 
currency,  it  has  made  it  inevitable  that 
the  rouble  will  become  absolutely  worth- 
less. 

If  the  Bolsheviki  remain  in  power  a 
few  months  longer  and  continue  to  print 
paper  money  at  the  same  rate  as  hither- 
to, Russia,  when  freed  from  the  Bolshe- 
viki, is  likely  to  have  one  of  the  best 
currencies  in  Europe.  To  achieve  this 
the  new  Government  will  have  to  nego- 
tiate a  foreign  loan  of  some  billion  or 
billion  and  a  half  dollars,  and  secure  it 
either  by  a  certain  mileage  of  State  rail- 
roads, or  by  a  large  area  of  State-owned 
forests. 

Having  obtained  such  a  loan,  the  Gov- 


*It  must  be  acknowledged  that  some  of  the  joint 
stock  companies  incurred  losses.  For  1.650  joint  stock 
companies,  for  which  available  data  exists,  the  total  of 
dividends  paid,  in  1911,  for  example,  to  share-holders, 
amounted  to  212  million  roubles,  and  the  losses  to  15 
million  roubles.  If  we  take  into  consideration  the  aver- 
age dividends  of  all  Russian  joint  stock  companies, 
taken  together,  they  will  be  decreased,  by  these 
losses,  by  one-third  to  one-half  per  cent.  But  this 
reduction  is  almost  negligible  compared  with  the 
increase  which  would  result  if  we  took  into  account 
the  effect  of  the  above-mentioned  watering  of  cap- 
ital bv  new  stock  issues. 


eminent  will  be  able  to  issue  a  corre- 
sponding amount  of  notes  on  a  gold 
basis. 

The  causes  of  the  rapid  influx  of  for- 
eign and  Russian  capital  into  Russian 
industries  and  trades,  in  the  years  im- 
mediately preceding  the  War,  are  shown 
in  diagram  No.  66,  which  gives  the 
average  dividends  and  net  profits  of  the 
most  important  Russian  industries  and 
trades  for  the  years  1911  to  1913,  as 
far  as  joint  stock  companies  are  con- 
cerned. From  the  data  given  in  this 
diagram,  it  may  be  seen  that,  regardless 
of  the  constant  watering  of  capital 
caused  by  frequent  new  issues  of  shares, 
the  annual  average  dividend,  paid  by 
many  enterprises  of  various  industries, 
was  much  higher  than  8  or  9  per  cent. 
If  we  compare  the  net  profits  of  these 
industries  with  the  amount  of  their 
paid-up  capital  and  bonds,  taken  togeth- 
er, the  proportion  would  be  still  higher. 
In  this  respect,  it  is  sufficient  to  state 
that  in  many  of  Russia's  industries  the 
proportion  of  net  profits  to  the  amount 
of  paid-up  capital  and  bonds,  taken  to- 
gether, was  over  15  to  20  per  cent,  reach- 
ing, in  some  cases, — as  in  the  rubber  in- 
dustry, more  than  30  per  cent.* 

This  comparatively  high  level  of  net 
profits  in  various  industries,  on  the  one 
hand,  as  well  as  the  excessively  cautious 
policy  of  the  majority  of  the  Russian 
joint  stock  companies,  striving,  as  may 
be  seen  from  the  accompanying  dia- 
gram, to  acquire  large  reserves  and 
sinking  funds,  on  the  other  hand,  are 
doubtless  the  main  causes  of  the  above 
mentioned  immense  influx,  during  re- 
cent years,  of  Russian  as  well  as  foreign 
capital  into  Russian  trade  and  industry. 


88 


RUSSIA  — HER  ECONOMIC  PAST  AND  FUTURE 


In  considering  the  question  of  invest- 
ments of  foreign  capital  in  Russian  in- 
dustry, we  cannot  pass  over  the  fact 
that,  in  certain  cases,  these  investments 
were  followed  by  considerable  losses,  re- 
gardless of  the  fact  that  general  condi- 
tions were  unquestionably  very  favor- 
able for  the  upbuilding,  in  this  or  other 
industries,  of  a  number  of  new,  very 
profitable  enterprises. 

These  failures  are,  in  the  great  ma- 
jority of  cases,  due  to  the  fact  that  for- 
eign capitalists,  when  starting  new 
enterprises,  instead  of  coming  to  agree- 
ment with  reputable  Russian  firms  well 
posted  in  that  particular  branch  of  pro- 
duction, or  with  prominent  Russian 
banks  which  have  been  financing  the 
given  industry  for  many  years,  preferred 
to  work  independently.  Without  famil- 


iarity with  local  conditions  of  production 
and  marketing,  and  often  falling  into 
the  unscrupulous  hands  of  dishonest 
promoters,  whose  sole  aim  was  to 
swindle  them,  such  investors  were  bound 
to  meet,  frequently,  with  disappoint- 
ments. 

Americans  who  intend  to  invest  cap- 
ital in  Russian  industry  should  take  par- 
ticularly into  account  these  disastrous 
experiences.  For  only  if  they  deal  with 
large  and  reputable  Russian  enterprises 
and  well-known  capitalists,  or  with  the 
Russian  banks  which  are  financing  the  in- 
dustry in  question  and  are  familiar  with 
its  conditions  as  well  as  the  problems  of 
marketing  the  products,  may  they  be 
confident  that  the  new  enterprise  will  be 
placed  on  a  firm  footing  and  the  invested 
capital  will  be  safe. 


CHAPTER    IX 


Conclusion — Russia's  Needs — Expenditures  Required  for 

the  Next  Ten  Years — Economic  and  Financial 

Cooperation  between  Russia  and  the  Allies 


Having  traced  the  course  of  develop- 
ment of  the  various  branches  of  indus- 
try in  Russia,  we  come  unavoidably  to 
the  conclusion  that,  although  the  devel- 
opment in  that  country  has  been  much 
slower  than  in  many  other  countries, 
particularly  in  comparison  with  Ameri- 
ca, none  the  less  the  country  has  prog- 
ressed. 

When  the  War  began,  Russia,  living 
up  to  the  obligations  which  she  had 
taken  upon  herself,  gave,  for  the  benefit 
of  the  general  cause,  the  lives  and  health 
of  millions  of  her  sons,  as  well  as  the 
resources  of  the  country  and  her  citi- 
zens. Although  almost  beggared,  Rus- 
sia bore  expenses  no  less  great  than  the 
richest  countries. 

As  a  result  of  this  unswerving  loyalty 
to  the  obligations  which  Russia  took 
upon  herself,  poor,  exhausted  by  suf- 
fering and  hunger,  she  underwent  the 
Bolshevik  catastrophy,  brought  about, 
as  is  well  known,  to  a  great  degree,  by 
the  German  General  Staff. 

What  the  War  failed  to  do  in  the  way 
of  decreasing  productive  work  in  Rus- 
sia, Bolshevik  nationalization  and  social- 
ization succeeded  in  doing.     Productive 


♦Regardless  of  what  has  been  said  before  con- 
cerning the  poverty  of  the  population  of  Russia,  her 
budget  rose,  within  the  decade  preceding  the  War, 
from  about  $1,000,000,000  to  about  $1,700,000,000. 
This  increase  was  due,  it  must  be  regretted,  only  in  a 
very  small  part  to  expenditures  for  increasing  the  pro- 
ductive capacity  of  the  nation,  for  the  old  regime,  as 
we  have  seen,  did  not  understand  such  problems. 

The  sums,  extorted  from  the  people,  were  spent 
in  enormous  quantities  for  the  upkeep  of  the  Army 
and  Navy,  which  were  consecrated,  after  War  was 
declared,  completely  to  the  cause  of  the  Allies,  and 
helped  them  to  save  Paris,  Calais,  Verdun,  North 
Italy,  and  other  important  military  places,  the  cap- 
ture of  which  by  Germany  would  have  brought  her 
a  decisive  victory. 

By  these  expenditures  directed  to  the  cause  of  the 
Allies,  Russia's  economic  future  was  sacrificed. 


activity  in  agriculture  diminished  and 
that  of  industry  was  almost  entirely 
done  away  with. 

To  exist  without  producing  is  impos- 
sible for  even  the  richest  country.  The 
accumulated  wealth  of  Russia,  which  we 
have  seen  to  be  a  poor  country  in  this 
respect,  is  too  insignificant  to  enable 
the  Bolshevik  government  to  continue 
long  in  power. 

It  will  not  be  long,  therefore,  before 
a  stable  government  will  be  reestab- 
lished in  the  country,  and  the  Russian 
people,  under  a  new  and  stronger  gov- 
ernment, provided  that  it  has  been  im- 
bued by  the  Allies  with  their  democratic 
traditions,  will  again  arise  as  a  mighty 
nation. 

When  that  moment  arrives,  the  Allies, 
in  order,  on  the  one  hand,  to  secure  the 
return  of  interest  on  their  old  loans  and, 
on  the  other  hand,  to  prevent  Russia 
from  again  becoming  a  German  colony, 
will  have  to  take  the  most  decisive  meas- 
ures for  the  upbuilding  of  the  productive 
forces  of  the  country.  It  is  clear  that 
only  in  this  way  will  the  comparatively 
undeveloped  country  of  Russia  be  able 
to  avoid  both  the  possibility  of  new  Bol- 
shevik disasters,  dangerous  alike  to  her 
and  to  her  Allies,  and  also  economic  and 
political  affiliation  with  Germany,  which 
might,  in  the  future,  lead  to  a  greater 
and  still  more  horrible  war. 

In  order  to  raise  her  economic  produc- 
tivity to  the  level  of  even  so  backward  a 
country  as  Austria-Hungary  was  before 
the  War,  Russia  will  have  to  expend,  in 
the  next  ten  years,  the  following  sums: 


90  RUSSIA  —  HER  ECONOMIC  PAST  AAD  FUTURE 


Expenditures  Required  for  the  Next  Ten  Years 

New  Railroads — Ten  years  at  about  3,500  to  4,000  miles  per  year. 

Total,  35,000  to  40,000  miles  at  $150,000  per  mile $  5,500,000,000 

New  locomotives,  new  freight  and  passenger  cars,  repair  of  the  (Ad 

locomotives  and  cars 3,500,000,000 

Street  railways,  subways,  pavement  of  towns  and  cities,  etc.,  etc 3,000,000,000 

Public  roads 1,500,000,000 

Inland  river  and  canal  improvements 4,000,000,000 

Improvements  of  ports 1,000,000,000 

Telephone  and  telegraph 1,000,000,000 

Grain  elevators   400,000,000 

Mercantile  Marine 200,000,000 

Irrigation  and  drainage 500,000,000 

Water  supply,  sewerage  and  other  hygieric  improvements  in  towns 

and  cities 2,000,000,000 

Central  electric  light  and  power  stations 2,000,000,000 

Public  Schools  ( 7,500  primary  and  secondary  schools  in  towns  and 
cities,  at   a  cost  of  $60,000  to  $100,000  each;  and  100,000  rural 

schools,  at  a  cost  of  $10,000  to  $20,000*  each 2,000,000,000 

Improvements  in  agricultural  machinery :     16,000,000  farms  at  $25 

per  year 4,000,000,000 

Improvements  in  cattle,  poultry,  stalls  for  cattle,  etc. :    16,000,000 

farms,  at  $25  per  year ' 4,000,000,000 

Colonization  of  the  eastern  provinces  of  European  Russia,  Turkestan, 

Siberia,  including  houses,  water-supply,  etc 1,000,000,000 

An  adequate  survey  of  the  forests,  local  railways  for  the  development 

of  forestry,  mining,  and  other  natural  resources 500,000,000 

Improvements  in  machinery  in  existing  factories,  mines,  etc.,  and 
building  new  factories,  mines,  etc. : 

Coal  and  coke,  peat,  iron  and  steel  production    2,000,000.000 

Oil  industry  . 500,000,000 

Manufacture  of  agricultural,  electrical  and  other  machinery  and 

implements ■ 1,000,000.000 

Ship-building 100,000,000 

Cotton  industry 300.000.000 

Wool  industry 150,000,000 

Flax,  hemp  and  jute  industry 100,000.000 

Silk  industry  100,000,000 


*  This    would   include    expenditures    for   libraries,  science  equipments,  niateriils,  etc..  etc. 


RUSSIA  —  HER  ECONOMIC  PAST  AND  EUTURE 


91 


Expenditures  Required  for  the  Next  Ten  Years 

( Continued) 

Lumber  industry 500,000,000 

Gold,  silver,  platinum,  copper,  lead,  zinc  and  other  metals 400,000,000 

Cement  and  lime ; 200,000,000 

Fertilizers 150,000,000 

Beet-sugar  industry 100,000,000 

Butter,  cheese,  condensed  milk,  oleomargarine,  slaughtering  and 
meat-packing,    ice -plants,    canning     and    preserving   fish    and 

fruits,  confectionery,  etc.,  etc 1,500,000,000 

Tobacco,  breweries,  mineral  waters,  etc 400,000,000 

Rubber  industry   150,000,000 

Brick  and  tile,  pottery,  glass,  etc 300,000,000 

Chemicals,  drugs,  dyestuffs,  soap,  perfumery,  etc.,  etc 1,500,000,000 

Leather,  shoes,  etc 300,000,000 

Paper,  wo..d  pulp,  etc 300,000.000 

Printing 300.000,000 

Miscellaneous   industries   (automobiles,   trucks,   aeroplanes,   phono- 
graphs, photographic  materials,  etc.,  e  tc. ) 2,000,000.000 

Total   $12,350,000,000 

Improvements  in  conditions  of  dwellings,  $5  per  year  and  per  capita.      8,000,000,000 

Grand  Total $56,450,000,000 

Judging  from   the  experience  of  the  With    the   assistance   of   these   great 

years    preceding    the    War,    it    may    be  democracies,  the  Russian  people,  accus- 

hoped  that  Russia  herself  will  produce  tomed  to  servile  submission  and  indo- 

about  half  this  sum.  lence,  will  soon  develop  in  themselves 

Part  of  this  money  could  be  raised  bv  ^he  qualities  o'f  the  Anglo-Saxon  race,— 

internal  loans,  and  a  part  obtained  from  '^^'^  for  consistent  work,  initiative,  and 

the  regular  budget.     In  the  latter  con-  ^he  energy  to  attain  to  self-set  ideals, 

",          .    1  ^t    .  .u     D  love  of  personal  freedom,  and  love  for 

nection,   it  must  be  noted  that  the  Rus-  .         ^ 

,      .               IP.  their  own  great  country, 

sian  budget  must  be  increased,  after  or-  t-,       .,     •                 i  .     ^                       r 

^                               r,    -r           o    •  1  hen  the  immense  latent  resources  or 

der   IS   restored,   at   least  2,   if   not  2y,  ^^^.^  ^^^^^^^^  ^.jj  ^^^^^  ^^  ^^^  ^^^^.^^ 

times,   compared  with   the   am.mnt   be-  people,  who  have  shown  such  great  abili- 

loie  tne  vvai.  ^^,  j^^  ^^^  ^^.^^  ,^j^j  sciences,  a  way  to  ma- 

The    remainder   should   be    furnished  terial  success,  to  leisure  and  culture,  and 

by  the  Allies,  and  among  them,  in  the  will  make  them,  in  cooperation  with  the 

first  rank,  the  United  States  and  Great  Allies,  one  of  the  upholders  of  Civiliza- 

Britain.  tion. 


RUSSIA  —  HER  ECONOMIC  PAST  AND  FUTURE 


93 


Locations  of  the  Chief  Industries  in  Russia* 


The  following  table  gives  an  alphabetic  finding-list  of  the  main  industries  of 
Russia  and  the  governments  in  which  the  most  impcjrtant  plants  and  factories,  en- 
gaged in  these  industries,  are  located: 


PRODUCTS: 


Cement 
Chemicals 

Clothing 
Cotton 

Electrical 
Glass 


Iron  and  Steel  Products, 
etc. 


Leather,  Boots  and  Shoes 


Linen** 


GOVERNMENTS: 

Volliynia,  Riazan,  Moscow,  Novgorod,  Petrograd,  Don  Cossacks 
Territory,  Ekaterinoslav,  Kaluga,  Livonia,  Esthonia,  Saratov,  Sim- 
birsk, Perm.  Ufa,  Kherson,  Black  Sea. 

Moscow,  Petrograd,  Kherson,  Vladimir,  Kharkov,  Ekaterinoslav, 
Kiev,  Kostroma,  Curland,  Livonia,  Yaroslav,  Perm,  Don  Cossacks 
Territory,  Samara,  Kazan. 

Mo.sc()w,   Riazan,  Petrograd,    Novgorod,   Kazan. 

Moscow,  Vladimir,  Riazan,  Kaluga,  Kostroma,  Smolensk,  Petro- 
grad, Moghilev,  Tula,  Penza,  Simbirsk,  Tver,  Saratov,  Nijni-Novgo- 
rod,  Curland,  Esthonia,  Livonia,  Tambov,  Yaroslav. 

Petrograd.  Moscow,  Livonia,  Esthonia,  Kiev,  Kharkov,  Crimea, 
\^oronezli,  Nijni-Novgorod,  Yaroslav,  Kherson. 

Moscow,  Vladimir,  V^ilna,  Vitebsk,  Vologda,  Volhynia,  Viatka,  Eka- 
terinoslav, Kazan,  Kaluga,  Kiev,  Curland,  Livonia,  Minsk,  Nijni- 
Novgorod,  Novgorod,  Orel,  Penza,  Perm,  Riazan,  Petrograd, 
Smolensk,  Kharkov,  Tver. 

Moscow,  Petrograd,  Tula,  Kharkov,  Kiev,  Ekaterinoslav,  Perm, 
Vladimir,  Don  Cossacks  Territory,  Kaluga,  Curland,  Livonia,  Nijni- 
Novgorod,  Olonetz,  Orenburg,  Samara,  Saratov,  Ufa,  Kherson, 
\'iatka,  Tver,   Tambov,  Voronezh,  Kutais,   Esthonia. 

Vilna,  Grodno,  Kovno,  Minsk,  Petrograd,  Moscow,  Tver,  Viatka, 
Kazan,  Kursk,  Kaluga,  Tambov,  Perm,  Vitebsk,  Don  Cossacks  Ter- 
ritory, Livonia,  Kherson,  Tchcrnigov,  Kiev,  Nijni-Novgorod,  Orel, 
Perm,  Orenburg,  Siml:)irsk,  and  many  regions  of  Asiatic  Russia. 

Vladimir  (40),  Kostroma  (24),  Moscow  (13),  Yaroslav  (9),  Livo- 
nia (4),  Perm  (3),  Petrograd  (2),  Pskov  (2),  Curland  (2),  Nijni- 
Novgorod  (2),  Tver  (1),  Vitebsk  (1),  Vologda  (1),  Viatka  (1), 
Grodno  (1),  Astrakhan  (1),  Kazan  (1),  Kovno  (1),  Riazan  (1), 
Samara  (1),  Kharkov  (1),  Esthonia  (1),  etc. 


♦Industries  concerned  with  the  production  of  raw 
materials  discussed  in  the  text,  such  as  coal,  copper, 
iron-mining,  etc.,  are  not  listed  here. 

**Figures  in  parenthesis  represent  the  number  of 
larger  factories,  as  given  by  the  Association  of  Linen 
Manufacturers. 


94 


RUSSIA  -  HER  ECONOMIC.  I' AST  AND  FUTURE 


Chief  Industries— C 071  tinned 


PRODUCTS: 
Machinery 


Pulp,  Cellulose, 
Paper  and  Card-Board 


Perfumery  and  Cosmetics 
Pottery 

Rubber 

Ship-building   (Sea  and 
River-going) 

Silk 

Sugar  (Beet) 

Tobacco  Manufacturing 


Wool 


GOVERNMENTS: 

Moscow,  Petrograd,  Kiev,  Kharkov,  Kherson,  Tula,  Baku,  Ekater- 
inoslav,  Grodno,  Curland,  Esthonia,  Livonia.  Minsk.  Nijni-Novafo- 
rod,  Don  Cossacks  Territory,  Vladimir,  Viatka,  Orel,  Samara,  Sara- 
tov, Tambov,  Crimea,  Vilna,  Volhynia,  Tver.  Voronezh.  Perm, 
Omsk,  Tomsk,  Irkutsk,  Vladivostok,  Yaroslav,  Ufa. 

Vilna,  Vitebsk,  Vologda,  Volhynia,  Kaluga,  Kovno,  Curland,  Livo- 
nia, Esthonia,  Vladimir,  Viatka,  Grodno,  Don  Cossacks  Territory, 
Kiev,  Kostroma,  Moghilev,  Minsk,  Nijni-Novgorod,  Novgorod, 
Olonetz,  Orel,  Penza,  Perm,  Kherson,  Tchernigov,  Yaroslav.  Petro- 
grad, Tver,  Tomsk. 
Moscow,  Petrograd. 

Volhynia,  Viatka,  Kaluga,  Moscow,  Petrograd,  Poltava,  Novgorod, 
Smolensk,  Tver,  Kostroma,  Nijni-Novgorod,  Orel.  Perm.  Kiev, 
Livonia,  Moghilev,  Kharkov,  Yaroslav. 

Petrograd,  Moscow,  Livonia. 

Petrograd,  Kherson  (Nicolaev,  Odessa),  Crimea,  Esthonia,  Livonia, 
Arkhangel.  Ribinsk,  Moscow,  Nijni-Novgorod.  Saratov,  Astrakhan, 
Perm,    Curland,    Madivostok. 

Moscow,  Vladimir.  Petrograd.  Elisavetpol,  Grodno. 
The  Southern,  South-Western  and  Central  Russia. 

Petrograd,  Moscow,  Kiev,  Crimea,  Smolensk,  Poltava,  Curland, 
Tambov,  Bessarabia,  Vilna,  Volhynia,  Grodno,  Livonia,  Orel, 
Podolia,  Kharkov,  Don  Cossacks  Territory,  Saratov,  Minsk,  Yaro- 
slav, Transcaucasian  region. 

Moscow,  Vladimir,  Tver,  Petrograd,  Nijni-Novgorod,  Kaluga,  Kos- 
troma, Penza,  Grodno,  Podolia,  Viatka,  Simbirsk,  Tambov,  Samara, 
Kazan,  Saratov,  Riazan,  LTfa,  Perm,  Kursk,  Tchernigov,  Yaroslav, 
Esthonia,  Livonia. 


The  War  has  forced  many  of  the  Russian  industries  to  seek  new  locations,  due  to  the  German 
invasion  of  the  western  section  of  the  country,  and  has,  thus,  greatly  strengthened  the  trend  of 
many  industries  toward  the  Volga.  If  the  development  of  railwa3's  and  canals,  discussed  in  pre- 
vious chapters,  is  accomplished,  the  region  of  the  Volga  will  undoubtedly  become  one  of  the  most 
important  industrial  centers  of  Russia. + 


.  t  More  or  less  exact  statistics  concerning  the  dis- 
tribution of  the  various  Russian  industries,  in  the 
different  parts  of  the  country,  as  well  as  the  statistics 
concerning  the  changes  which  have  taken  place  in 
recent  decades,  with  reference  to  the  trend  of  the 
industries  toward  the  East,  are  absolutely  unobtain- 
able, since  there  has  been  but  one  census,  that  of 
1897.  which  was  very  badly  organized,  as  ^  of  the 
population  was  illiterate. 

The  old  Government  spent,  annually,  many  hun- 
dred millions  for  absolutely  useless  purposes,  but 
was   not  able   to    find,   even   once,   after    1897.    some 


20  or  25  million  dollars  to  finance  a  census,  such  as 
have  been  taken,  more  or  less  regularly,  in  the  United 
States,  the  United  Kingdom.  Germany  and  almost 
all  civilized  countries. 

One  of  the  first  necessities  for  the  new  Govern- 
ment, after  order  is  restored,  must  be,  therefore,  the 
organization  of  an  adequate  Census  Bureau,  which 
will  furnish,  regularly,  exact  statistics  concerning 
the  population,  agriculture,  industries,  etc. 

Without  this  the  new  Government  would  have 
no  solid  basis  for  its  economic  and  financial  policy. 


How  Germany  Was  Able  to  Dominate  the  World  Market 


A  CHANGE  is  mjw  coming  over  the 
economic  life  of  the  United  States. 
Whereas,  before  the  War,  the  in- 
dustryof  this  country  was  concerned  almost 
entirely  with  the  domestic  market,  she 
must  now  become  a  serious  competitor  in 
the  World  Markets.  This  economic  revo- 
lution is  intensified  by  the  fact  that,  after 
the  conclusion  of  peace,  from  two  to 
three  million  soldiers,  who  were  in 
trade  and  industry  before  the  War,  must 
return  to  business  at  a  time  when  their 
places  have  been  taken  by  others,  who 
also  cannot  be  turned  away  without 
serious  disorder. 

To  this  must  be  added  the  fact  of  the 
enormous  increase  of  the  productive  ca- 
pacity of  the  country,  which  was  fos- 
tered by  the  rapid  increase  in  the  em- 
ployment of  all  kinds  of  machinery, 
which  is  so  characteristic  of  American 
production.  In  my  opinion,  there  is  no 
mistake  in  saying  that,  from  the  begin- 
ning of  the  European  War,  the  product- 
ive capacity  of  the  United  States  has  in- 
creased at  least  from  30  to  35%. 

Unaccustomed  to  trade  in  a  World 
Market,  with  which  she  is  unfamiliar. 


*  Before  the  War  "A.-E.-G."  controlled  a  capita! 
of  at  least  half  a  billion  dollars  and  manufactured 
at  its  numerous  plants  in  Berlin,  Frankfort-on-Main, 
Hennigsdorf,  Vienna,  Riga,  Milan,  etc.,  the  follow- 
ing products:  railroad  supplies,  high-tension  wire, 
apparatus  and  supplies,  small  and  large  dynamos  and 
other  electric  machinery,  electric  locomotives,  arc 
lamps,  supply  materials  circuit-breakers  and 
switches,  integrating  meters,  typewriters,  fans  and 
ventilators,  measuring  instruments,  electric  clocks, 
electrical  naval  instruments  and  apparatus,  turbo- 
generators, wires  and  cables,  incandescent  lamps, 
various  porcelain  insulatory  materials,  varnishes, 
heating  apparatus,  flying  machines,  nuts,  all  kinds 
of  instruments,  railroad  signaling  devices,  machinery 
for  printing  railroad  tickets,  electric  welding  outfits, 
rr'achirery  for  tempering  steel  and  other  metals,  ozonat- 
ing  plants,  searchlights,  etc. 


and  feeling  that  the  domestic  market  has 
become  too  limited  for  her  increased 
productive  forces,  American  Industry  is, 
at  present,  in  a  period  of  indecision  and 
doubt. 

At  such  a  time  it  would  be  inter- 
esting for  American  manufacturers  to 
become  acquainted  with  the  system 
which  gave  to  Germany  the  possibility, 
within  the  last  two  decades,  of  attaining 
to  one  of  the  first  places  in  the  World 
Trade. 

The  most  characteristic  phenomenon 
in  this  direction  was  the  economic  policy 
of  the  large  German  electrical  concern, 
Allgemeine  Elektrizitats  -  Gesellschaft, 
which,  like  a  monster  octopus  with  thou- 
sands of  tentacles,  encircled  the  whole 
universe  and,  assisted  by  the  power- 
ful German  Banks,  and  in  alliance 
with  two  or  three  other  concerns,  more 
or  less  closely  united  with  these  banks, 
created  an  organization  permitting  her 
to  be  omniscient  of  all  matters  pertain- 
ing to  the  World'  Market. 

From  the  official  list  prepared  by  the 
Allgemeine  Elektrizitats  -  Gesellschraft, 
which  is  in  my  possession,  the  accom- 
panying diagram  was  prepared,  show- 
ing the  expansion  of  the  branches  of  the 
"A.-E.-G."  throughout  the  whole  world. 

From  this  diagram  it  may  be  seen 
that,  irrespective  of  the  fact  that  it 
had  possession  of  various  plants,  instal- 
lation-bureaus, sales-bureaus,  stations, 
etc.,  etc.,  in  almost  all  the  large  cities  of 
Germany  (in  all  about  180  German 
cities)*,      it      had      also      innumerable 


96 


RUSSIA       HER  ECONOMIC  PAST  AND  FUTURE 


branches  in  almost  all  important  com- 
mercial centers  throughout  the  world, — 

e  cr 

In  Europe — Austria-Hungary,  in  thir- 
ty cities;  Italy,  in  ten  cities;  England,  in 
seven  cities;  Spain,  in  seven  cities;  Bel- 
gium, in  six  cities;  Sweden,  in  six  cities; 
France,  in  five  cities;  Norway,  in  five 
cities;  Switzerland,  in  four  cities;  Rou- 
mania,  in  three  cities;  Holland,  in  two 
cities;  Portugal,  in  two  cities;  Denmark, 
in  one  city;  Turkey  (European),  in  one 
city;  Greece,  in  one  city. 

In  Asia — China  (including  Manchu- 
ria), in  twelve  cities;  Japan  (including 
Korea  and  Formosa),  in  ten  cities ;  Sing- 
apore, one  ofiice;  Java,  two  offices;  In- 
dia, in  two  cities ;  Siam,  in  one  city  :  Tur- 
key (Asiatic),  in  one  city. 

In  Australia — In  four  cities. 

In  North  America — In  one  city. 

In  South  and  Central  America — Mex- 
ico, in  one  city;  Cuba,  in  one  city:  Bra- 
zil,   in   three    cities;   Argentine,   in    one 


t  With  regard  to  various  other  enterprises  with 
which  the  "A.-E.-G."  of  Berlin,  according  to  its  own 
statements,  was  in  close  contact,  besides  the  Bank 
fiir  Elektrische  Unternehmungen  in  Zurich,  the  fol- 
lowing concerns  must  be  especially  mentioned: 
(1)  A.  E.  G.  Lahmever  Werke,  with  a  capital  of 
50,000,000  marks;  (2)'  Deutsch-Ueberseeische  Elek- 
trizitats-Gesellschaft.  with  a  capital  up  to  1913  of 
230.000,000  marks;  (3)  Gesellschaft  fur  Elektrische 
Unternehmungen,  in  Berlin,  with  a  capital  in  1912 
of  105,000,000  marks;  (4)  British  Thomson-Houston 
Company,  in  London;  (5)  Compagnie  Francaise 
Thomson-Houston,  in  Paris:  (6)  Societe  Financiere 
de  Transport  et  d'Enterprises  Industrielles.  in  Brus- 
sels; (7)  Societe  Generale  Beige  d'Enterprises  Elec- 
triques.  in  Brussels,  etc.  In  addition  to  corporations 
with  which  the  ".A.-E.-G."  of  Berlin  was  closely  asso- 
ciated, the  following  factories  were  established  in 
Russia  with  her  direct  help:  (1")  a  branch  of  the 
Berlin  firm  of  \.  Guttman;  (2)  a  branch  of  the  Ger- 
man concern  of  Koerting  Brothers;  (3)  an  electrical 
company  in  Warsaw;  (4)  the  .Associated  Cable 
Works  in  Petrograd ;  (5)  the  so-called  Company  of 
the  year  1886,  in  Moscow.  The  last-mentioned  or- 
ganization was  under  the  auspices  of  the  ".\.-E.-G." 
through  the  intermediary  of  the  Bank  fiir  Elektrische 
Unternehmungen  in  Ziirich.  which,  according  to  the 
official  information  of  the  "-A.-E.-G.,"  was  closelj- 
affiliated  with  that  company  but,  in  reality,  was  com- 
pletely in  its  hands.  This  bank  helped  the  ".A.-E.-G." 
to  borrow  money  from  Switzerland,  France.  Bel- 
gium and  other  countries. 


city;  Chile,  in  one  city;  Peru,  in  one  city; 
Uruguay,  in  one  city;  Ecuador,  in  one 
city;  Guatemala,  in  one  city;  Costa  Rica, 
in  one  city. 

In  Africa — Egypt,  in  two  cities; 
Transvaal,  in  two  cities. 

The  same  may  be  said  with  regard  to 
Russia,  where  the  "A.-E.-G."  of  Berlin 
maintained  its  branches,  plants,  installa- 
tion bureaus,  electrical  stations,  etc.,  in 
the  following  cities:  Petrograd,  !Mos- 
cow,  Riga,  Kharkov,  Kiev,  Odessa, 
A\'arsaw,  Lodz,  Sosnovitzi,  Samara,  Ros- 
tov-on-Don, Ekaterinoslav,  Baku,  Eka- 
terinburg, Irkutsk,  Omsk,  Vladivostok, 
Tashkent,  Helsingfors,  \'iborg  and  Abo. 

In  this  manner,  as  may  be  seen  from 
the  adjoining  diagram,  with  the  exception 
of  North  America,  where  by  agreement 
the  field  was  left  to  Americans,  there  ex- 
isted practically  no  important  city  or 
large  commercial  and  industrial  center 
in  the  whole  world,  in  which  the  "A.-E.- 
G."  of  Berlin  had  no  branch. t 

Just  before  the  War  broke  out  the 
paid-up  capital  of  the  "A.-E.-G."  of  Ber- 
lin amounted  to  155.000,000  marks,  the 
reserves  and  other  funds  to  9.^.000,000 
marks,  and  the  bond  issues  to  180.000,- 
000  marks,? 

The  Germans  have  created  organiza- 
tions, in  connection  with  other  industries, 
similar  to  the  A.-E.-G..  for  cornering  the 
Markets  of  the  World,  both  in  general, 
and  in  particular,  in  Russia. 

To  compete  successfully  with  such  or- 
ganizations, backed  by  the  most  promi- 
nent and  best  organized  banks  in  the 
world,  such  as  the  Deutsche  Bank, 
Discontogesellschaft,  Dresdner  Bank, 
Darmstadter  Bank,  Schaaffhausenscher 
Bankverein.  National  Bank  fiir  Deutsch- 

%  .All  figures  not  including  companies  under  the 
control  of  the  "A.-E.-G." 


RUSSIA  ~  HER  ECONOMIC  PAST  AND  FUTURE 


97 


land,  Berliner  Handelsgesellschaft, 
Bleichroder,  Delbriick,  Leo  &  Company, 
etc.,  with  a  combined  paid-up  capital,  be- 
fore the  War,  of  over  $320,000,000,  re- 


♦  In  these  sums  are  not  included  the  paid-up  cap- 
ital, reserve  funds  and  deposits  of  smaller,  but  often 
very  important  banking  corporations  controlled  by 
the  above-mentioned  principal  German  banks.  For 
instance,  the  Deutsche  Hank  controls  the  following 
banking  corporations:  Deutsche  -  Ueberseeische 
Bank,  Deutsch  Ostafricanische  Bank,  Deutsche  Ve- 
reinsbank  in  Frankfort-on-Main,  Essener  Kredit- 
.'Vnstalt,  Hannoversche  Rank.  Mecklenburger  Hypo- 
thek-  und  Wechselbank,  Nieder-Lausitzer  Bank, 
Oldenburger  Spar-  und  Leihbank.  Pfalzische  Bank, 
Privatbank  in  Gotha,  Rheinische  Kreditbank,  Schles- 
i.schcr  Bankvcrin.  Wiirttembergische  Vereinsbank, 
Deutsche  Treuhandcls-Gesellschaft,  Markische  Bank, 
etc. 


serves  and  other  funds  of  about  $120,000,- 
000  and  deposits  of  more  than  $1,250,000,- 
000,*  the  American  industries  must  be 
backed  by  special  agreements  of  the  big- 
gest banks  in  the  United  States. 

It  seems  to  me,  should  the  latter  not 
back  the  American  industries,  the  effort 
of  the  United  States  to  become  a  serious 
competitor  in  the  World  Market  will 
end  in  a  series  of  severe  disappoint- 
nients. 


98 


lit  SSI  t       IIEIi  KCOXOMK:  past  AM)  FUTURE 


COMPARATIVE   TABLE   SHOWING   THE   TOTAL   AREA,   POPULATION,    ACREAGE 
UNDER    CULTIVATION,    AND    PRAIRIES    AND    PASTURES    IN    THE 
MAIN    DIVISIONS    OF    RUSSIA    IN    1914 


Area  in  Square 

Acreage  under 

Prairies  and 

l^Dpiilatioti 

Versts 

Cultivation 

Pastures 

( in  millions) 

( in  millions) 

( in  ilessiatines) 

(in  dessiatinesi 

European  Russia 

131, S 

4,25 

78,8 

22,2 

(51   fJovernmcnts) 

Caucasus _ 

13,2 

0,41 

9,1 

1.5 

Central  Asia  _ 

11,3 

3,11 

5,5 

4,2 

Siberia              

10,4 
12,2 

11,00 
0,10 

7,6 
5,3 

6,4 

Poland   - 

0,86 

Finland    

3,3 

0,29 

1,7 

0,86 

TABLE  SHOWING  THE  AREA,  URBAN  AND  RURAL  POPULATION,  AND  THE  DEN- 
SITY OF  POPULATION  OF  THE  MAIN  REGIONS  OF  RUSSIA 


Central  Agricultural 

Central   Volga- 

Lower  Volga-? 

New   Russia^ 

The  South-West5 

Little  Russia" 

Industrial    Region''... 

White   Russia* 

Lithuania'  

Lake  Region'" 

The  Baltic" _.... 

Ural  Region'^ 

North  Region'^ 

North  Caucasus'-* 

Trans-Caucasus'5  

Turkestan'"  

West  Siberia'7 

Ost-Siberia'«  


Area  in  Square 
Versts 

262,300 

360,100 

506.600 

354.600 

144.700 

137.800 

261.000 

210.100 

117.900 

293.600 

81.000 

425.000 

1,095,400 

195,000 

217,123 

1,164,000 

4,961,000 

6.035.000 


Population 
Urban 

1.579.000 

1.611,000 

764,000 

3,044.000 

1,707,000 

1,337,000 

2,976.000 

1.178.000 

1.029.000 

2,631,000 

1,045.000 

433  000 

163.000 

570,000 

1.390.000 

1.107.000 

826,000 

518,000 


Population 
Rural 

16.566  000 

14,000.000 

6.835.000 

13.133.000 

11,6.^0.000 

9.170.000 

10.100,000 

8.639.000 

6.108.000 

4.219.000 

2.058.000 

7.712,000 

2.115.000 

5.149.000 

6.120.000 

4.848,000 

7,279,000 

1.825.000 


Inhabitants 

Per  Square 

Verst 

69.1 

43,3 

15,0 

45,6 

92.4 

76,2 

50,0 

46,7 

60,5 

23,3 

38,2 

19,1 

2,0 

29.3 

34,5 

5,1 

1,6 

0.4 


Rural 
Inhabitants 
Per  Square 

Verst 

63.1 
38.9 

13.0 

37.4 

80,4 

66,5 

38,6 

41,1 

51,8 

14,3 

25.4 

18,1 

1,9 

26,4 

28,1 

4,1 

1,4 

0,3 


'  Government.^  of  Kursk,  Orel,  Tula,  Riazan.  Tambov  and  Voronezh. 

■?  Governments  of  Saratov.  Simbirsk,  Penza,  Kazan.  Nijni-Novgorod  and  Ufa. 

3  Governments  of  Samara,  Orenburg  and  Astrakhan. 

4  Governments  of  Bessarabia,    Kherson,   Crimea,  Rkaterinoslav,  Don  Cossacks  Territory. 

5  Governments  of  Podolia.  Kiev  and  Volhynia. 

<5  Governments  of  Kharkov,  Tchernigov  and  Poltava. 

7  Governments  of  Vladimir,  Moscow,  Kaluga,  Tver,  Yaroslav  and  Kostroma. 

S  Governments  of  Moghilev.  Minsk.  \Mtebsk  and  Smolensk. 

P  Governments  of  Vilna.   Kovno.   Grodno   and  Kholm. 
'0  Governments  of  Livonia.   Curland   and   Esthonia. 
"  Governments  of  Viatka  and  Perm. 
'^  Governments  of  Vologda  and   .Arkhangel. 

a; Territories  of  the  Cossacks  of  the  Kouban  and  Terek,  and  Government  of  Stavrol. 

'•(Governments  of  Baku.  Black  Sea,  Tiflis,  Erivan.  Elisavetpol,  Koutais.  Provinces  of  Batum.  Dages- 
tan, Kars,  Zakatal  and  Sukhum. 
'5  Territory  of  the  Cossacks  of  the  Ural,  Provinces  of  Turgai,  Semipalatinsk.  .Akmolinsk  and  Semirechensk. 
'6  Provinces  of   Syr-Daria.  Ferghana,   Samarkand  and  Trans-Caspian. 
'7  Governments  of  Yenissei,   Irkutsk,  Tobolsk  and  Tomsk. 
'*  Provinces  of  Trans-Baikal,  Yakutsk,  Amour,  Sakhalin.  Kamchatka  and  Maritime  Province. 


RUSSIA  -    HER  ECONOMIC  PtST  AND  FUTURE 


99 


Comparative  Table  of  Russian  and  American 

Measures 


1  dessiatine  =  2.705  acres 

1  rouble  in  gold  =  51.46  cents 

1  pood  =  40  Russian  pounds 

=  36.1  American  pounds 
1  verst  =  0.663  miles 
1   square  verst  =  0.44  square  miles 
1  short  ton  =  55.38  Russian  poods 

=  2000  American  pounds 


1  acre  =  0.37  dessiatines 

1   dollar  =  1.94  roubles  in  gold 

1   metric  ton  =  61  Russian  poods 

=  2204.7  American  pounds 
1   mile  =  1.508  versts 
1   square  mile  =  2.27  square  versts 
1  long  ton  =  62.03  Russian  poods 

=  2240  American  pounds 


Note:     The  author  lakes  pleasure  in  acknowledging  with  thanks  the  able  assistance 
of  Mr.   Daniel  B.  l^arv  in  tiie  Iranslalion   of  this  book. 


Contents 


Page 
Introduction  b}'  A.  J.  Sack,  Director  oi 
the  Russian  Information  Bureau  in 
the  U.  S 3 

Foreword  by  the  Author , 5 

Chapter  I.  Russia's  Economic  De- 
velopment and  the  Old  Regime ....      7 

Chapter  II.  Cultivation  of  Grain- 
Foodstufifs  and  Russia's  Role  in 
the  World  Market — Cattle  Raising 
— Production  of  Coal,  Iron,  Oil, 
Copper,  Lead,  Zinc,  Cotton,  etc. 
— National  Wealth — Comparison 
with  Other  Countries,  Especially 
with  the  United  States 13 

Chapter  III.  Foreign  Trade  and 
Merchant  Marine — Items  of  Rus- 
sia's Exports  and  Imports — Grain 
Elevators  —  Comparisons  with 
Other  Countries ; 25 

Chapter  IV.  Canals  and  Inland 
Waters — Comparison  wath  Other 
Countries — Proposed  New  Canal 
and  River  Improvements — Ex- 
penditures for  Construction 39 

Chapter  V.  Ports — Their  Trade — 
Comparison  with  Other  Countries 
— Expenditures  for  Improvements.   45 

Chapter  VI.  Railroads — Their  In- 
come— Proposed  New  Lines — 
Necessary  Expenditures  for  Con- 
struction and  Rolling  Stock 40 

Chapter  VII.  Natural  Resources — 
Minerals :  Basin  of  the  Donetz — The 


Page 
Ural     Region  — ■  The     Caucasus  — 
Siberia. — Other  Resources:  Forests 
— Timber  Exports — Furs — Hides — 
Fishing — Fruit,  Rice  and  Tea — Silk 

— Flax — Cotton — Wool 57 

Chapter  VIII..  .  Russia's  Banks- 
Banking  and  the  Economic  Devel- 
opment of  the  Country — Divi- 
dends and  Profits  in  Various  In- 
dustries— Bolshevism  and  Russia's 
Banks  and  Industries — Past  and 
Future  of  Foreign  Capital  in  Rus- 
sian Banking  and  Industries 79 

Chapter  IX.  Conclusion — Russia's 
Needs — ^Expenditures  Required 
for  the  Next  Ten  Years — Eco- 
nomic and  Financial  Cooperation 
between  Russia  and  the  Allies — 
America's  Great  Opportunities  in 

Russia's  Reconstruction 89 

Locations  of  the  Chief  Industries  in 

Russia 93 

How  Germany  Was  Able  to  Domi- 
nate the  World  Market 95 

Comparative  Table  Showing  the 
Total  Area,  Population,  Acreage 
under  Cultivation,  and  Prairies 
and  Pastures  in  the  Main  Divi- 
sions of  Russia  in  1914 98 

Table  Showing  the  Area,  Urban  and 
Rural  Population,  and  the  Density 
of  Population  of  the  Main  Divi- 
sions of  Russia 98 

Comparative  Table  of  Russian  and 
American  Measures 99 


INDEX 


* 


PAGE 

Area,  Total,  and  under  cultivation  in  Russia 

19,  20,  98 
Area,  Total,  and  under  cultivation  in  Russia  19,20 

Asbestos 60 

Associations,  Agricultural,  number  of 10 

Banks,  Russian,  and  Bolshevism 86 

Banks,  Russian,  capital  of 85 

Banks,  Russian,  their   capital   compared    with 

that  of  Canada's 85 

Banks,  Russian,  deposits   83 

Banks,  Russian,  dividends  of  85 

Banks,  Russian,  number  of  branches  compared 

with  those  of  Canada 84 

Barley,  Russia's  exports 30 

Bran,  Russia's  exports 30 

Canals   and   Waterways   in   Russia;   Govern- 
ment's expenditures 39 

Canals  and  Waterways  in  Russia;  Govern- 
ment's program  for  improvements 41 

Canals  and  Waterways ;  Russia's  expenditures 
compared  with  those  in  other  countries. .  40 

Canals  and  Waterways  in  Siberia 41,  42 

Capital,  English  in  Russia 81,  82 

Capital,  French  and  Belgian 9 

Capital,    influx    into    Russian    industries    and 

trades,  causes  of 87 

Capital  investments,  dangers 88 

Cattle,  number  of,  in  Russia  and  other  coun- 
tries      18 

Chromic  ores 60.  63 

Coal  deposits  in  Central  Russia 62 

Coal  production  in  Russia 11,  57 

Coal,  Russia's  production  compared  with  that 

of  other  countries 43 

Coal,  Russia's  production  compared  with  that 
of  the  United  States 21,  43 

*  This  index  includes  references  to  maps  and  dia- 
grams. The  statistical  data  from  which  the  diagrams 
are  constructed,  as  well  as  the  statistical  data  used  in 
the  text,  are  taken  from  official  reports,  both  Russian 
and  foreign.  The  diagrams,  with  the  exception  of  some 
half  dozen  taken  from  official  reports,  are  from  previous 
publications  and  lectures  of  the  author.  Books  of  ref- 
erence are  not  referred  to,  owing  1o  the  fact  that  they 
are,  for  the  most  part,  in  Russian,  and  in  many  ca«es, 
at  present,  inaccessible. 


PAGE 

Coke,  Russia's  production  of 57 

Copper  ore  production  in  the  Caucasus 60 

Copper  production  in  the  Caucasus 60 

Copper  production  in  Russia 11,  58,  59 

Copper  production  in  the  Urals 59 

Cooperative  Societies,  Agricultural,  number  of  10 
Corn,  Russia's  exports  compared  with  those 

of  Argentine 34 

Corporations  in  Russia 80 

Corporations,  Russian,  capital  of 81 

Cotton  cultivation  74 

Cotton  exports  from  Central  Asia 75 

Cotton  industry,  number  of  spindles  in  Rus- 
sia and  the  United  States 20 

Cotton,  Russia's  part  in  the  World  production  76 
Cotton  production  in  Russia,  necessary  im- 
provements and  expenditures 76 

Cotton,  Russia's  production   compared   with 

that  of  the  United  States 20 

Cotton,  Russian  and  foreign  used  in  Russian 

factories    75 

Crops  in  Russia  and  in  the  United  States.  ...    16 
Currency,  Russian,  and  Bolshevism 87 

Electric    power    stations    in    Russia,    horse- 
power and  necessary  expenditures. .  .42,  43 
Expenditure  of  the  Russian  Ministry  of  Agri- 
culture for  agricultural  improvements. 9,   10 
Expenditure   of    the   Zemstvos    for   Agricul- 
tural improvements 9,  10 

Exports  from  Russia,  articles 28,  47 

Exports  from  Russia 26,  27 

Exports  per  capita,  Russia's  compared  with 
those  of  other  countries 36,,  38 

Flax-fibre  exports  from  Russia 73 

Flax-fibre  production  in  Russia 72,  73,  74 

Flaxseed    exports,   Russia's    compared    with 

those  of  Argentine 35 

Fish  exports  and  imports 70 

Fishing  in  Russia 69 

Fruit-growing  in  Russia 70 

I'orests  in  the  Caucasus 65 

Forests  in  Central  Asia 65 


I N  D  EX —  Continued 


PAGE 

Forest  in  European  Russia 64,  65,  66,  67 

Forest  in  Siberia 64,  65,  66,  67 

Furs,  exports  from  Russia 67,  68 

Germany's  methods  of  dominating  the  World 

markets    95,  96,  97 

Gold  deposits  in  Siberia 63 

Gold  production  in  Russia 59 

Grains,  exports  from  Russia 29,  30 

Grain  elevators  in  Russia  compared  with  those 

in  Canada 34,  37 

Grain    elevators,    necessary    expenditures    in 

Russia 35 

Grains,  production  in  Russia 13,  14 

Graphite 60 

Graphite,  deposits  in  Siberia 63 

Horse-power  used  in  Russia  and  the  United 
States 21 

Imports,  Russian,  England's  and  Germany's 

share  in  25 

Imports  into  Russia 26,  27 

Imports  into  Russia,  articles 28 

Imports  into  Russia  under  Russian  and  for- 
eign flags 37 

Iron  and  steel  production,  Russia's 57,  58 

Iron  deposits  in  Central  Russia 61 

Iron  industry,  necessary  improvements  in.  .  .  .  55 

Iron  ore  deposits  in  Siberia 62 

Iron  ore  deposits  in  the  Urals 58 

Iron  ore  production  in  Russia 11,  57 

Iron  ore,  Russia's  production,  and  comparison 

with  tlie  United  States 19 

Joint  stock  companies,  England 7 

Joint  stock  companies  in  Russia 7 

Lead  production  in  the  Caucasus 60 

Lead,    Russia's    production,    and    comparison 

with  tlie  United  States 20 

Locations  of  the  chief  industries 93,  94 

Manganese  exports  from  Russia 62 

Manganese   exports    from    Russia    compared 

with  those  of  other  countries 61 

Manganese  ore  production  in  the  Caucasus.  .   60 

Manganese  production,  Donetz  Basin 57 

Measures,  Russian  and  American  equivalents. 99 
Melon  growing  in  Russia 71 


PAGE 

Merchant   Marine,   Russia's,   compared   with 

that  of  other  countries 35,  37 

Mercuric  ores  in  the  Urals 60 

Mercuric  ores  in  Siberia 63 

Mica 60 

Natural  resources,  Basin  of  Donetz 57 

Natural  resources,  Ural  Region 58 

Natural    resources,    Siberia 63 

Needs,   Russia's,  and  expenditures   required 

89,  90,  91 
Nickel    60 

Oil-cake,  Russia's  exports 30 

Oil,  production  in  Russia 11,  60 

Oil,  Russia's  production,  compared  with  that 

of  the  United  States 19 

Oats,  Russia's  exports 30 

Oats,  Russia's  exports  compared  with  those  of 

Argentine   33,  36 

Phosphate  rock 60 

Platinum,  production  in  Russia 59 

Population  of  Russia,  density 98 

Population  of  Russia,  Urban  and  Rural 98 

Pig-iron,  production  in  Russia 11,  57 

Pig-iron,  Russia's  production,  compared  with 

that  of  the  United  States 19 

Ports,  Odessa,  its  rank  in  World  trade 45 

Ports,  Petrograd,  its  rank  in  World  trade.  ...  45 

Ports  in  Russia 45 

Ports  in  Russia  compared  with  those  of  other 

countries 46,  47 

Railroads,  rolling  stock,  necessary  expendi- 
tures for  improvements 55 

Railroads,  Russia's  compared  with  those  of 
the  United  States 49 

Railroads,  Russia's,  passengers  carried  and 
freight  hauled 51 

Railroads  in  Russia,  program  for  improve- 
ments     54 

Railroads,  increase  in  Russia,  compared  with 
that  of  Canada 52 

Railroads  in  Russia,  length  of  lines  under  con- 
struction by  government  and  private  cor- 
porations      50 

Railroads  in  Russia,  necessary  new  lines  and 
expenditures  55 


INDEX      Con  ti  filled 


PACK 

Railroads,  payments  of  the  private  owned  rail- 
roads to  the  governnicnl 50 

Rare  metals  in  Siberia 63 

Rice  growing  in  Russia 71 

Rivers  in  Siberia 42 

Rye.  Russia's  exports 30 

Sah  production,  Russia's 57 

Securities,  Russian,  new  issues 81 

Semi-precious  stones  in  the  I'rals 60 

Semi-precious  stones  in  Siberia 63 

Sheep,  number  of,  in  Russia 76,  77 

Sheep,  number  of,  in  Russia  compared  with 

that  of  other  countries 76 

Silk,  raw,  pre;  luction  in  Russia 72 

Silver  and  lead  ores 60 

Silver  production  in  the  Caucasus 60 

Silver  production  in  the  Urals t)0 

Stock  quotations  in  Russia 79 

Tea-growing  in  Russia 71 

Timber  areas  in  Russia  compared  with  those 

of  the  Ignited  States  and  Canada 67 

Timber,  excess  of  imports  in  the  United  States  68 

Timber  exports  from  Russia 66,  67,  68 

Trade,  World,  participation  in,  of  most  im- 
portant  competitors   of   Russia 28,  30 

Trade,  World,  Russia's  participation  in. .  .28,  30 


PAGE 

Value  of  agricultural  products  in  Russia  and 
the  United  States 22 

Value  of  the  agricultural  products,  per  capita, 
in  Russia  and  the  United  States 18 

Value  of  the  industrial  i)ro(lucts  of  Russia 
and  the  United  States '. 22 

Watermelon  growing  in  Russia 71 

Waterways,  Russia's 39 

Wealth,  National,  of  Russia  and  other  coun- 
tries     23 

Wheat,    average   yield    in    Russia   and    other 

countries 15,  16 

Wheat,  average  yield  per  capita 31 

Wheat,  Russia's  exports 30 

Wheat,  Russia's  exports  compared  w'ith  those 

of  Argentine  and  Canada 31,  32,  33 

Wheat,  Russia's  imports  into  the  United  King- 
dom compared  with  those  of  Argentine, 

Australia  and  Canada 3J 

^^'ool  industry  in  Russia 77 

W'ool,  exports  to  Europe  and  North  America .    77 

Zinc,  Russia's  jMiiduction  of,  and  comparison 
with  that  of  the  United  States 20 


By  the  Same  Author 

Problems  of  Population  in  France.     Petrograd,  1903. 

Inquiry  Concerning  the  Causes  of  the  Decline  in  the  Importation 
of  Russian  Wheat  to  England.     Petrograd,  1903. 

Statistics  and  Their  Bearing  on  Present  Society.  Petrograd,  1904. 
(Published  in  Russian,  French  and  German.) 

The  Real  and  Apparent  Causes  of  the  Static  Condition  of  Popula- 
tion in  France.     Miinchen,  1898. 

The  Problems  of  Population  and  Industrial  Development  in 
France.     Berlin,  Guttentag,   1900. 

Germany's  Future  in  the  Light  of  the  Agrarian  Agitation. 
Munchen,  1898. 

Industrial  Freedom  in  Its  Different  Aspects.     Zurich,  1901. 

The  Past  and  Present  Condition  of  Germany's  Soda  Industry, 
Stuttgart,  1895. 

Industrial  Development  and  Wealth.    Stuttgart,  Cotta,  1897. 

Syndicates  and  Trusts  in  Relation  to  Present  Political  Economy. 
Moscow,  1907. 

Same,  2nd,  revised  and  augmented  edition.    Part  1,  Moscow,  1912. 

The  Russian-German  Commercial  Treaty  and  the  Problems  of 
Russia.     Moscow,  1912. 

The  Russian-German  Commercial  Treaty;  or  Shall  Russia  be  a 
German  Colony?  1st  edition,  Moscow,  1912.  2nd  revised  and 
augmented  edition.   Moscow,  1915. 

Political  Economy  in  Its  Practical  Aspects.  2nd,  revised  and  aug- 
mented edition.     Part  1,  18  lectures.     Moscow,  1913. 

Does  Russia  Offer  a  Field  for  the  Development  of  Trusts  and 
Syndicates?     Moscow,  1913. 

The  Russian  Coal  Syndicate  and  the  Crisis  in  Fuel.    Moscow,  1913. 

The  Panama  Canal,  the  Decline  in  the  Price  of  Grain,  the  War 
and  Russian  Commercial  Treaties.  3rd,  revised  and  aug- 
mented edition.     Moscow,  1915. 

The  War,  German  Syndicates,  Russian  Exports  and  Russian  Com- 
mercial Treaties.  3rd,  revised  and  augmented  edition.  Mos- 
cow, 1915. 

The  German  Yoke  and  the  War  for  Freedom.    Moscow,  1915. 

Is  Our  Industry  Threatened  with  Destruction?     Moscow,  1918. 

America's  Opportunities  for  Trade  and  Investment  in  Russia. 
New  York,  1919,  Russian  Information  Bureau. 


UC  SOUTHERN  REGIONAL  LJBRAflY  FACIL 


D    000  969  530    5 


